HMRC: Citizens Advice Bureau could cost you tax penalties

Posted by AccountingWEB PM | on Thu, 04/09/2008 - 18:38 3765 2 comments

Tax editor, Nichola Ross Martin writes: The next time you phone up your local Citizens Advice Bureau (CAB) for advice about your tax problems, be warned, you might land yourself with tax penalties, according to HM Revenue and Customs.

Its strange but true, it's now your duty to vet your volunteer advisor to make sure that he or she is trained and competent in the relevant area of taxation.

Continued...

But.......

Anonymous | Mon, 08/09/2008 - 16:06 | Permalink

it doesn't help the poor taxpayer who,if phoning the CAB, probably can't afford a proper advisor. He will get all the normal demands and his only recourse will be to sue after the event. Perhaps the CAB will be able to recommend a good solicitor too!

Careless talk costs money.

lawmaniz | Mon, 08/09/2008 - 13:23 | Permalink

No problem here, boys and girls. A person acting in a voluntary capacity who gives wrong advice to another would incur liability for a negligent mis-statement at common law: Hedley Byrne & Co Ltd v Heller & Partners (1964) AC 465, House of Lords. And the voluntary organisation or employer would be vicariously liable (e.g. CAB; ACAS; Business Link.)

A person who gives wrong advice to another in a contractual relationship would incur liability under the Misrepresentation Act 1967.

Remember that the former can come into play if an accountant gives an innocent but wrong answer to a casual question by a person at a social or quasi-social gathering (Chaudry v Prabhakar (1989) 1 WLR 29, Court of Appeal) so (i) watch what you say and (ii) keep your professional indemnity insurance up to date.