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HMRC announce another new "role for agents"

The tax check is not an enquiry or a compliance check into an individual’s affairs, but ...

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"From April 2022 in England and Wales, the renewal of licences to drive taxis and private hire vehicles, to operate a private hire vehicle business, or to deal in scrap metal, will only be given if the person applying can show they have completed a tax check with HMRC.
As decisions on applications for these licences are conditional on the tax check, this is known as ‘tax conditionality’.

Questions in the tax check include a small number of multiple-choice questions to determine whether applicants have notified chargeability to income tax or corporation tax, and whether income from the licensed activity has been reported on a tax return.
Because of the simple nature of the check and its link to licensing processes, the design of the service does not include an option for agents to complete the check on a client’s behalf.
We would expect agents to be involved in wider processes linked to the tax check. For example, this may include agents’ supporting customers who need to register for the appropriate tax.

If you have any questions about tax conditionality or would like to meet and discuss it with us, email [email protected] "

 

Once again, the objective is sound enough, although an article in yesterday's Agent Update is the first that I've heard of it.  But my concern is the vagueness in the message to Agents as, once again, they "expect agents to be involved" and yet "the design of the service does not include an option for agents to complete the check on a client’s behalf".  In other words they want Agents to somehow support their objectives (presumably via free communication/advisory services and hand-holding), but not do anything that the client might regard as a chargeable service (like preparing/submitting accounts).  'Cake, your, having and eat it' spring to mind!

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By I'msorryIhaven'taclue
17th Sep 2021 20:09

Good spot, Hugo.

Hugo Fair wrote:

"From April 2022 in England and Wales, the renewal of licences to drive taxis and private hire vehicles, to operate a private hire vehicle business, or to deal in scrap metal...

Uber drivers, on both counts?

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Replying to I'msorryIhaven'taclue:
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By Hugo Fair
18th Sep 2021 11:59

I get the lateral thinking, but in London it's the mini-cabs that are rust-buckets ... Uber (and Bolt et al) mostly seem to drive really expensive vehicles (Mercs are a favourite). Maybe that's why HMRC are having a look?!

I suspect the invention of 'tax conditionality' will be a relative storm in a teacup for agents ... the current licensing requirements are hardly arduous (go on-line + provide: Passport & NI nos, proof of address within last 3 months and a driving-licence for 3 years (UK or EU!).

And of course it will only affect Agents with relevant clients (until HMRC decide to broaden the scope?) ... but it's the two-faced attitude that I was highlighting - we're OK as a free support resource, but untrustworthy otherwise?

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By DKB-Sheffield
18th Sep 2021 14:16

Hugo Fair wrote:

"From April 2022 in England and Wales, the renewal of licences to drive taxis and private hire vehicles, to operate a private hire vehicle business, or to deal in scrap metal, will only be given if the person applying can show they have completed a tax check with HMRC.

Interesting choice of target!

Clearly, some private hire cabs (etc.) are more akin to scrap metal than cars and I have no idea how some get through the 6 monthly MOT (which is not really an MOT at all)!?

However, if bringing tax compliance into licensing is an effort to apply 'joined up thinking' there are many other LA (and related) licence applications/ renewals I'd be targeting including:

- Waste Carriers Licence and Permits (skips, house clearance, 'scrap' collectors - not 'scrap metal dealers')
- Food Premises Licence (roadside cafes, burger vans, ice cream vans)
- Construction-Related Licenses/ Permits (Streetworks, CDM, Building Control)
- Entertainment Permits/ Registrations (bouncy castles, children's party entertainers)

If the new requirement is to reduce tax dodgers, the regulated 'scrap metal dealers' and the 'private hire car drivers' (by which I mean those already properly registered!) are probably not the best target to increase the Revenue's tax take (although they may be some of the easiest to hit).

If the requirement is simply to tick boxes, rather than actually make a difference, it clearly does the job!

In response to your actual point...

It is the language used by HMRC that annoys me (not just in this case but, SEISS and others). "We would expect agents to be involved" sounds like it is an agent's duty, rather than part of a service to a client. "may include agents' supporting customers" suggests the support is a simple gesture of goodwill.

HMRC in this (and many other) instances, seem to suggest the hard work is the actual submission of a form/ application (i.e. the hard part being the billable part). This is rarely the case, but their language belittles the preparatory works required. I'm sure we all have many clients who - given all of the relevant details - could file their own SATR, CT600 or Company Accounts, but does that mean they have "done their own return" (etc.)?

I do have concerns that HMRC are trying to move towards the position where they believe agents are superfluous and should have limited access to client tax affairs. I accept there are some very poor agents out there (with about as much tax knowledge as my neighbour's dog). However, in the main agents provide a service to clients that HMRC will never be able to supply - saving time, and the public purse.

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By Tax Dragon
18th Sep 2021 22:01

While "expect" does have, amongst its meanings, a kind of "require" sense, the more normal meaning is closer to "anticipate".

And, in context (the previous sentence exonerating agents from duty), I would read "we would expect agents to be involved" much more as "we think [anticipate] clients will ask their agents about..." than (as Hugo and DKB seem to) HMRC itself "requiring" some kind of unpaid support from agents.

In short, keep your knickers on, sweeties.

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Replying to Tax Dragon:
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By Hugo Fair
18th Sep 2021 22:40

Ooh sweeties ... hang on, I was warned about dragons offering them!

Actually for once I wasn't forensically examining specific words ... it just seemed like yet another example of HMRC being happy to 'outsource' the things THEY are paid to do (communicate and administrate the collection of taxes) to people (agents) who will not find it easy to charge for doing this part of HMRC's job.

This is NOT the same as other threads on here about responsibility for checking SEISS claims ... but is yet another example of the trend to an increasingly one-sided relationship between HMRC and Agents. It's moved from broadly collaborative to almost entirely adversarial.
It is also part & parcel of the reason for HMRC accepting sloppiness in the state of what they do to taxpayers' data ... relying on the unpaid (taxpayers and/or agents) to try and investigate/resolve such issues - despite lack of help from HMRC.

To cap it all, as DKB says, there is a definite undercurrent from HMRC of mistrust of Agents. They may have dropped ideas raised in Treasury only 5 or so years ago (requiring accreditation, or if not that then grading Agents by HMRC to determine what services they would be allowed to provide, and so on) ... but the ideas are still floating in the minds of wonks.

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Replying to Hugo Fair:
By Duggimon
20th Sep 2021 10:05

I don't know about that, it read to me that they expect people who have agents, or who want agents, to need their agents' help in registering for any and all taxes that will apply and ensuring they are compliant, before the applicant completes this check that will determine if they are, I don't think there's anything in there to say they expect agents to be involved in the actual check, it's just advising us that this thing exists and people might ask about it.

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Replying to Duggimon:
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By Tax Dragon
20th Sep 2021 10:22

My point, far more clearly, lucidly and well made. Thank you.

Also (@Hugo)... "To cap it all, as DKB says, there is a definite undercurrent from HMRC of mistrust of Agents." Ja, mebbe - but Self Assessment means that HMRC's role is necessarily more focussed on enforcement. So... what do you expect? And there are some mistrustworthy agents out there. (And in here, if we're honest.)

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Replying to Tax Dragon:
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By Hugo Fair
20th Sep 2021 11:42

I don't deny the fact that there are mistrustworthy (interesting new word) agents out there - and probably in here as well - but my rose-tinted specs still hanker for days when the relationship was more collaborative and not adversarial by default.

More importantly, if the sector needs some kind of policing (which is what HMRC want) then this should not be carried out by them. Quis custodiet ipsos custodes.

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Replying to Hugo Fair:
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By Hugo Fair
20th Sep 2021 11:51

And to bring things back to my OP topic ... I'm not claiming that the impact on Agents will be high with regard to any of their existing clients (in the affected categories).
My point is the involvement 'expected' is broadly the communication/advisory services and hand-holding that the taxpayer values as 'free'; whereas the bit that clients, wrongly in my opinion, value as being chargeable (completing/submitting forms) is in this case excluded.
That may or may not be deliberate, but it shows a lack of understanding of the relationship between the set of agents and the set of taxpayers (including those who are trawling around for a one-off solution).

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Replying to Hugo Fair:
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By Tax Dragon
20th Sep 2021 12:00

Hugo Fair wrote:

Quis custodiet ipsos custodes.

In the era of Trump (please tell me it's over?!), Johnson, Modi et al, that question is more urgent than ever. Putin has a point about the state of western democracy. (Mind you, I prefer it to his own. Or Xi's. Etc.)

As for HMRC, the Tribunals keep them in pretty good check. (Though Justin asserts - with some justification, IMHO - an HMRC bias in higher courts, and the quis custodiet question remains valid.)

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Replying to Tax Dragon:
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By Hugo Fair
20th Sep 2021 14:07

The list of rogues/charlatans is much longer ... as I said to Western Democracy when I saw it trudging down the road last week "Nice handcart, where ya goin'?"

But my point about HMRC is still being missed. I'm not concerned about the activities for which Tribunals can act as a balance ... it's HMRC's desire to control who can be an Agent and which services a particular agent can perform.
There was a proposal that this last aspect could be 'regulated' by HMRC (via 'black marks' for late filings or enquiries, or even number of rebates requested, etc) ... in other words they would be able to determine the viability of your business, solely based on non-disclosable 'facts' (aka interpretations or beliefs).

I can't disclose the meetings at which such proposals were put forward (and at which I and others managed to get them dropped), but they are not entirely off the radar ... and gain strength from the corrosive mistrust that is building.

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Replying to Hugo Fair:
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By Tax Dragon
20th Sep 2021 14:20

That discussion is surely live inside and outside HMRC - JS caused no end of uproar in here, for example, by daring to suggest that formal training might provide something that experience alone doesn't.

To avoid relighting that fire, let's quickly move on to another example: it has been suggested in here that not being a member of a regulated accounting body can be advantageous as, so the suggestion goes, you are not bound by their regulations. I'm not siding with HMRC here, but I am seeing the issue that they see. (If I still miss your point, I apologise.)

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Replying to Tax Dragon:
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By Hugo Fair
20th Sep 2021 14:46

I shall have to stop referring to it as my 'point', since repetition seems only to be blunting rather than sharpening it! However one last try.
I too see the issue that you (and HMRC and others) observe, but unlike HMRC do not see them as being part of any solution - hence the Latin quote earlier.

Using the simplified model in operation for most non-tax matters: one group (sometimes Parliament sometimes local authorities etc) set the rules; another (usually the Police but sometimes a specialist force) enforces those rules; and a third (usually the Courts) allows for disputes to be judged/resolved.
Even countries not following the Western democracy model claim to understand & follow these separations of power - although the boundaries are often blurred and or open to outside influence.

So by all means let's have a debate on how to regulate and/or improve standards within the accounting services sector (although as you say preferably not here today!) ... but HMRC's role should be restricted to that of Police (in my analogy above) and not allowed to stray beyond that.
And specifically they should not be allowed to determine who may provide what services, other than via enforcement of rules set by others (as opposed to via their own internal & opaque beliefs).

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Replying to Hugo Fair:
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By Tax Dragon
20th Sep 2021 16:02

Gottcha. You're so obviously right that I didn't realise what you were saying!

At least the thread makes sense to me now :-)

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By Paul D Utherone
20th Sep 2021 16:19

I noticed this one yesterday as well, and sighed.

Always remember back to the days I was in IR and moved offices. The office had a list of B&B's / guesthouses for those transferring in. It was only some months on that they realised that they had no record of half of the landladies on the list (not at my instigation!) :D

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