New Rev bully boy tactics against self-employed?

New Revenue bully boy tactics against self...

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The Revenue are apparently now writing to self employed taxpayers, before they file their returns, telling them that they have been picked out as "requiring particular attention" and threatening dire consequences if their claims for expenses are incorrect.

This is described as part of as national initiative. To quote from a letter apologising for upsetting a client

"By assisting people to get things right befre they submit their return, the intention is to minimise the likelihood of an enquiry".

What a lot of codswallop.
Can we stop these threatening letters proliferating?
Montrose

Replies (13)

Comments for this post are now closed.

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By User deleted
12th Sep 2004 00:03

Why bother?
Tell your clients to bin the letters. Two seconds - dealt with - no problem.

No point sending the stock letter below. It would be a very nice letter except there's no duty 'to satisfy yourself as to the adequacy of a tax return properly delivered' or 'duty to make such enquiries as are necessary to bring about such satisfaction' any more, and as such the rest is nonsense that won't get anywhere.

And definitely don't waste time applying to the Commissioners to get a closure notice for a non existent enquiry. And if you do, and you then ask for compensation for your trouble, I would only expect to get laughed at...

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By AnonymousUser
06th Sep 2004 11:59

risk analysis
I share the annoyance of previous writers, but I think that the situation's even worse, if information gleaned from local Revenue offices is accurate.

The Revenue "enabling" letters to self-employed & more recent letters to contractors/subbies are totally crass &, as pointed out, "illegal." In addition local offices are given no information to explain why "the Computer" has selected specific taxpayers for this outlandish treatment.

So the letters succeed in;
1. frightening taxpayers despite the obscene claim that they're "helping,"
2. probably testing some clients' faith in us
3. exacerbating our pressures & possibly at extra cost to us, unless compo claimed, and
4. contributing yet more reason to destroy local Revenue staff's morale.

I agree all the steps suggested, but there's an important prior consideration. Why was your client selected? If you believe Revenue are simply being mischievious, OK, but on the other hand, even if they are, selection is supposedly based on risk assessment. Why does your client appear to differ from the industry norm? Of course it could be down to Revenue incompetence e.g. inappropriate criteria laid down, or even to failure to read info in a white box, but I think we do need to consider this first.

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By stratty
06th Sep 2004 16:00

Client Selection
The selection criteria for these "enabling letters" was statistical analysis based on 2003 Tax Returns submitted.

Where specific trade groups turnover and expenses fall outside a preset level of tolerance then the computer sends out an automatic letter.

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By AnonymousUser
06th Sep 2004 12:21

Human Rights Act
As a ps to my previous comment about charging the Revenue it also seems that there could be a Human Rights Act issue here ie if you are accused of something you have the right to know. These letters really do strike me as being the modern equivalent of the old pre SA letter that usually started off ' I have reason to believe etc.'If you were lucky in pre SA days you could sometimes get a 'clue' by telephoning the office in question.

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By markgosling
06th Sep 2004 11:37

Self employed subcontractor
I have a contractor who received one of these letters sugesting that he should review the employment status of his only subcontractor. After speaking to him about it, he has decided to change his status to an employee. Unfortunately this means that the inland revenue tactics seem to be working and they could use this to justify further bully boy tactics.

He has asked me if he should reply to the letter. My concern is that if he replies stating that he is changing the employment status of his subcontractor to an employee, then this could triger an enquiry and they may go back 5 years. He feels that by replying to the IR, it will 'get them off his back' and avoid an enquiry.
Any thoughts or suggestions?

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By John Savage
03rd Sep 2004 14:21

Yep - charge
I agree with Michael.

If the Revenue are sending these letters out and they have (i) no legal basis, and (ii) they have not followed the correct procedure for mounting an enquiry, and (iii) the client has not instructed us - then it is hardly incumbent upon our client(s) to settle our invoice(s) for work involved in dealing with these letters.

Therefore, I have to assume that the Revenue are prepared to pay for our time in replying to them. I shall certainly be submitting my invoice(s).

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By michaelblake
02nd Sep 2004 16:32

was there an earlier reference to this on Aweb?
I have a vague recollection of seeing reference to this elsewhere on Aweb (or in Taxation) where the suggestion was to write to the Revenue along the lines that:

1. since the inspector was only permitted to raise points in connection with entries on the return within the context of TMA 1970 Section 9A they assumed the letter to be an enquiry within the terms of S9A TMA 1970, and

2. they would like to know specificaly what information the inspector was looking for or failing that would apply to the General Commissioners for closure under TMA 1970 Section 28A

The suggested reply was more polished than the above, and although you might find fault with it on technical grounds it did strike me as an appropriately silly reply to a particularilty silly letter from the Revenue.

Does anyone have a better recollection of this?

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By stratty
03rd Sep 2004 12:31

the letter went something like this
Thank you for your letter of the 2nd August 2004.

Please be assured that our client’s tax return for the year ended 5th April 2004 will be prepared with the same care and attention as that of the previous year, both being prepared with no less than the care and attention normally required of any taxpayer in the preparation of any tax return.

You have a duty under sections 1 and 29, Taxes Management Act 1970, to satisfy yourself as to the adequacy of a tax return properly delivered. If you are not so satisfied then you have a duty to make such enquiries as are necessary to bring about such satisfaction, whether by negotiation or imposition by the Commissioners or (as the case may be) judiciary. Your powers to make such enquiries are set out in section 9A, Taxes Management Act 1970.

We note that your letter makes no reference to section 9A, Taxes Management Act 1970, as we understand to be customary, but there is no statutory requirement for such reference to be explicit. It is, however, clear from your letter that you are dissatisfied with the return for the year ended 5th April 2003. On the reasonable assumption that you have acted in accordance with your duty we must assume that your letter comprises a notice of enquiry under section 9A. As there are no specific matters raised in that letter requiring a response we assume that there are no such matters and we have accordingly written to the Commissioners (copy attached) requiring them to issue a notice of closure of said enquiry under section 28A(4), Taxes Management Act 1970.

Yours faithfully,

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By AnonymousUser
02nd Sep 2004 09:51

Ring the Inspector
Hi,
When a client of mine received one of these letters I immediately rang the Inspector to complain.Let them know what you think, what harm can that do?

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By AnonymousUser
03rd Sep 2004 12:40

Charge them
Not only should we seek a closure notice but I
think in the circumstances we are justified in seeking recompense for our time, which I really do not think we can recover from our clients.

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By User deleted
20th Sep 2004 17:46

Customs and Excise are joining the party too?
The "Risk Division Corporate Hospitality Project" is sending out letters headed
"Business entertainment education programme: Action required"
which invites the recipient to state whether he has correctly or incorrectly accounted for input tax on entertainment,and if incorrectly, confirms he has now filed a Voluntary disclosure !!
The letter requests a response within 14 days not of receipt, but of the date typed on the letter.
What is going on here?

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Tom Herbert
By Tom Herbert
29th Mar 2018 22:28

Thread closed - please refrain from resurrecting old threads unless there's a specific reason to do so.

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