Residence, domicile, IR35 enquiries, Code of Practice 9 (alleged serious fraud) and offshore disclosures.
Can you share a practical tip for dealing with enquiries?
Get personal. Far too many enquiries are dragged down by long, rather pointless letters being sent back and forth. The formality of letter writing is often a roadblock to real progress and has become something each side can hide behind.
What advice would you give to HMRC?
Two things. Train your people well: give them the skills and then the chance to make decisions. Then trust them to make those decisions well. Most HMRC employees are trying to do the best job they can in difficult circumstances. Don’t keep undermining them. A generation of officers has emerged who are incapable of resolving a case without the backing of an internal committee: a recent one required 26 HMRC staff – that is a huge waste of time and resource.
Are there any forthcoming tax measures of particular concern?
The change to IR35 that’s coming in April, whereby public sector engagers decide the status of their workers, is misconceived. Abuses of employment status should be pursued, but HMRC can already do that. These changes will ride roughshod over years of complex legal decisions and will unduly punish the genuinely self-employed and their engagers. We can have little doubt they will in time be extended to the private sector.
If you could make one change to UK tax law or practice what would it be?
Make disclosure easier. Surely HMRC wants to encourage voluntary disclosure, but recent changes have made it more difficult. We can’t disclose direct to a local office or a specialist section unless fraud is involved. The restrictions of Code of Practice 9 mean there is no middle ground for a client who simply wants to admit negligence. And the online system to support other disclosures is woefully inadequate. HMRC is putting barriers in the way of people sorting out errors in their tax affairs, which is crazy.
Which tax announcement caught your eye in the Budget?
I was struck by the way Mr Hammond spoke about incorporation as a tax minimising strategy. He compared the higher level of tax and NICs of an employee with that paid through a company. But that is comparing chalk and cheese. This thinking must come from the Treasury, who seem to forget that the company is a legal person which can’t be ignored. Most companies are formed as the best vehicle for running a business, not as a tax avoidance device. I fear we will hear more about this in 2017.
Aside from your colleagues, who in tax do you most admire, and why?
Well, he was once a colleague and we sat in next door offices – it has to be John Whiting. He is such a professional in everything he does and he represents the profession perfectly. I have given many a presentation with John and these were always daunting because you knew the audience only turned up to hear from him!
Finally, you might not know this about me but…
I’m just over half way through walking the 214 Wainwright hills of the English Lakes, and I go walking every year with my former tax colleagues from HMRC, walking the highest peaks of European countries.
Residence, domicile, IR35 enquiries, Code of Practice 9 (alleged serious fraud) and offshore disclosures.
Can you share a practical tip for dealing with enquiries?
Get personal. Far too many enquiries are dragged down by long, rather pointless letters being sent back and forth. The formality of letter writing is often a roadblock to real progress and has become something each side can hide behind.
What advice would you give to HMRC?
Two things. Train your people well: give them the skills and then the chance to make decisions. Then trust them to make those decisions well. Most HMRC employees are trying to do the best job they can in difficult circumstances. Don’t keep undermining them. A generation of officers has emerged who are incapable of resolving a case without the backing of an internal committee: a recent one required 26 HMRC staff – that is a huge waste of time and resource.
Are there any forthcoming tax measures of particular concern?
The change to IR35 that’s coming in April, whereby public sector engagers decide the status of their workers, is misconceived. Abuses of employment status should be pursued, but HMRC can already do that. These changes will ride roughshod over years of complex legal decisions and will unduly punish the genuinely self-employed and their engagers. We can have little doubt they will in time be extended to the private sector.
If you could make one change to UK tax law or practice what would it be?
Make disclosure easier. Surely HMRC wants to encourage voluntary disclosure, but recent changes have made it more difficult. We can’t disclose direct to a local office or a specialist section unless fraud is involved. The restrictions of Code of Practice 9 mean there is no middle ground for a client who simply wants to admit negligence. And the online system to support other disclosures is woefully inadequate. HMRC is putting barriers in the way of people sorting out errors in their tax affairs, which is crazy.
Which tax announcement caught your eye in the Budget?
I was struck by the way Mr Hammond spoke about incorporation as a tax minimising strategy. He compared the higher level of tax and NICs of an employee with that paid through a company. But that is comparing chalk and cheese. This thinking must come from the Treasury, who seem to forget that the company is a legal person which can’t be ignored. Most companies are formed as the best vehicle for running a business, not as a tax avoidance device. I fear we will hear more about this in 2017.
Aside from your colleagues, who in tax do you most admire, and why?
Well, he was once a colleague and we sat in next door offices – it has to be John Whiting. He is such a professional in everything he does and he represents the profession perfectly. I have given many a presentation with John and these were always daunting because you knew the audience only turned up to hear from him!
Finally, you might not know this about me but…
I’m just over half way through walking the 214 Wainwright hills of the English Lakes, and I go walking every year with my former tax colleagues from HMRC, walking the highest peaks of European countries.
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