What’s new in the world of tax?

Advisers face 100% fines if they help tax “avoiders”

The financial secretary to the Treasury, has opened consultation over new proposals of governance that could see enablers of tax avoidance face fines of up to 100% of the money lost to HMRC. A Treasury source said the proposed crackdown would mean that “any kind of middle man” involved in a scheme struck down in the courts could be pursued by tax officials. The new powers would allow tax officials to pursue accountancy firms, lawyers and bankers for devising and selling schemes designed to avoid tax.

22801064_sFrank Haskew, head of the tax faculty at the Institute of Chartered Accountants, said: “The government needs to ensure any new rules are targeted only to tackle those advisers that promote aggressive tax schemes rather than the vast majority of reputable advisers engaged in ordinary tax planning.” John Cullinane, policy director at the Chartered Institute of Taxation, urged caution, saying: “The government needs to be careful that in their efforts to wipe out avoidance schemes they don’t prevent taxpayers from getting access to honest, impartial advice on the law. Definitions will be crucial.”

The pace of tax change is unrelenting and there have been huge changes in policy and approach by HMRC over the last few years, not to mention a raft of consultations about many different areas of tax, and likely changes to the penalties regime.  This year’s changes to tax compliance sees new criminal offences being introduced and further toughening up on tax avoidance.  It is therefore more important than ever that ordinary taxpayers with everyday tax problems get the help and guidance they require without the threat of ambiguous, unclear or inconstant rules about what is or is not tax avoidance hanging over their advisers’ heads.  So we will watch this space with much interest and not a small degree of concern….

HMRC texts warnings to taxpayers

48482327_mHMRC has started to send out text messages to taxpayers warning that they are being “monitored” to ensure they pay on time. More than 13,000 self-assessment taxpayers have taken part in trials which have seen them sent SMS messages. The taxpayers, who had previously been contacted by HMRC about their debt, received three types of message from the Government’s “Nudge” unit or Behavioural Insights Team. The ‘standard’ SMS message alerted the recipient to the debt and told them how to pay, while the ‘monitoring’ message pointed out that HMRC would be monitoring whether the debt was paid in the following week. The ‘penalties’ message included the phrase, ‘Most people pay on time to avoid penalties’. HMRC says it has gained an extra £210m from taxpayers by using ‘nudge’ tactics that predict how people will respond to official communications and encourage them to make the ‘right’ response. However, Anita Monteith, senior tax policy adviser at the ICAEW, warned that ordinary taxpayers could become needlessly alarmed by the messages.

Selfie help for tax officials

Finance ministry officials in Greece are trawling the social media profiles of possible tax cheats, monitoring about 1.8m people believed to be declaring an income inconsistent with the lavish lifestyles they document online!

Treasury refuses inquiry into tax credits contract

The Treasury has said it will not hold an inquiry into outsourcing firm Concentrix’s failings, despite complaints from MPs about the number of people wrongly deprived of tax credits. Jane Ellison, the financial secretary to the Treasury, confirmed HMRC had decided not to renew Concentrix’s contract over the quality of its work.

No penalty for failure then.

Poldark star hires mum for accountancy advice

Perfect red heart vector isolatedPoldark actor Aidan Turner has hired his mother as his accountant after fearing that his finances would be investigated by HMRC. The 33-year-old said: “I have hired my mum as my accountant, which is great because it means I know the taxman won’t be knocking at my door.”

If only we’d known that job was going…swoon!

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Nov 25

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