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Serial Tax Avoidance Legislation

Serial Tax Avoidance Legislation

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Anyone else had one of these letters today? Apparently they're reviewing some of my clients already. News to me!?

Replies (17)

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By stratty
03rd Mar 2017 11:35

The legislation was introduced in the Finance Act 2016 so not a massive surprise.

If some of your clients have been targeted how dodgy are they?

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abc
By Kim Jong Un's Hair
03rd Mar 2017 11:51

I'd like to say not at all. I'm too lame at tax to get involved in anything too close to the wind... No EBTs, no film partnerships, not even EIS/SEIS stuff.

For clarity it says "our records show that you represent one or more clients who we are investigating because they have used a tax avoidance scheme".

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By stratty
03rd Mar 2017 11:54

Ahhh right. We will probably receive one too then as I am aware of at least one client that was involved in the Montpellier derived schemes some ten -fifteen years ago.

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By GW
03rd Mar 2017 13:13

We recieved one, I'm also having trouble working out which, if any, clients it might apply to.

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By Wiganer Elaine
03rd Mar 2017 15:21

I received one today and rang the Revenue to ask which client(s) because as far as I am aware none of my current clients would be using tax avoidance schemes.

I was informed that it could be a generic letter and if any client was being investigated they, and I, would receive a letter detailing the investigation!

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RLI
By lionofludesch
03rd Mar 2017 17:11

So their records are wrong, then.

Or the piece about their records showing that one or more clients have used a tax avoidance scheme is just a huge lie.

So much for HMRC integrity.......

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Replying to lionofludesch:
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By woody24
04th Mar 2017 16:08

I also got the same letter from HMRC this morning saying their records show that I represent one or more clients HMRC are investigating because their records show they (the clients) have used a tax avoidance scheme. I am sure (or as sure as I can be) that I have no clients who have used a tax avoidance scheme or who are under investigation for using a scheme. If this is a circular it is very badly phrased!

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By Bruce Roberts
03rd Mar 2017 17:18

We had such a letter this morning and if any our clients are using a tax avoidance scheme then it is news to us. The letter has the feel of a scare letter which is being sent to agents but it is awfully direct and specific: the first paragraph says:

'I am sending this letter to you because our records show that you have one or more clients who we are investigating because they have used a tax avoidance scheme.'

Do we ignore it? Do we ask HMRC for specific information? Do we make an FOI request as they clearly hold information about us that we are not aware of and which might well be wrong? How many of these have been sent out and how have they decided who to send them to?

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By thomas34
04th Mar 2017 18:40

Just had one of these and have given HMRC the chance to tell me which client or clients they are investigating. Failing that I propose to bill them for my time and for lying to me. After 52 years in the profession I reckon it's time to stand up to these *****. The first sentence of their letter is pretty clear cut and apart from their poor use of English ("who" instead of "whom") it might well give rise to a letter to my MP.

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By gordo
06th Mar 2017 11:35

Have HMRC just used this as a 'nudge' letter tactic to scare any and all advisors from thinking about acting for anyone involved in an avoidance scheme?

So have they wasted your time and given you undue concern?

Their letter is actually a little bit (deliberately?) misleading because they don't mention that any tax avoidance strategies entered into before 15th September 2016 are not caught by this new legislation except to receive a warning notice if defeated. Penalties, it would appear, can only apply to any new schemes entered into after 15th September 2016 and only if defeated.

I think a FOI request to establish how many letters were issued might be worth doing.

HMRC should be asked to establish whether their opening paragraph, "I am sending this letter to you because our records show that you represent one or more clients who we are investigating because they have used a tax avoidance scheme" is truthful or, if this is a generic letter, then it is a lie.

Did we just re-write our Professional Conduct guidelines because of a challenge from HMRC and the Government?

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By mail.taxperfect.co.uk
08th Mar 2017 13:31

I received this letter. I know of a couple of my clients who have been involved in Tax Avoidance schemes (and have received APN's). Not sure what action I'm meant to be taking?

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RLI
By lionofludesch
08th Mar 2017 13:45

I haven't received one and am feeling left out.

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By gordo
03rd Apr 2017 13:20

Some Accountants were saying they had received this letter despite knowing that there was no way any of their clients had done any such thing. The Accountants certainly would or should know if their client is under investigation.

Yet the opening line of the letter said: “I am sending this letter to you because our records show that you have one or more clients who we are investigating because they have used a tax avoidance scheme”

It struck me that HMRC might actually be using this as a ‘nudge’ and sending to all Accountants. Which would mean their opening sentence was bare-faced lie designed to scare the Accountants.

So I thought I would try a freedom of information request to see if my suspicions were correct.

Their response is:

1. There were some 6625 letter sent.
2. They would not confirm for me if they only sent this to Agents who had clients under investigation and instead hid behind some reason for non disclosure. Me thinks they doth protest.

I can’t believe that some 6625 Agents had client who had “…one or more clients who we are investigating because they have used a tax avoidance scheme”. Especially since a quick Google search suggests there are around 7,000 Accountancy Firms in the UK.

What do you think about this behaviour?

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Replying to gordo:
RLI
By lionofludesch
03rd Apr 2017 19:47

gordo wrote:

I can’t believe that some 6625 Agents had client who had “…one or more clients who we are investigating because they have used a tax avoidance scheme”. Especially since a quick Google search suggests there are around 7,000 Accountancy Firms in the UK.

What do you think about this behaviour?

I'm appalled.

I'm one of 375 firms in the country which hasn't received one of these letters.

It's a disgrace.

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By Justin Bryant
03rd Apr 2017 13:52

Surely in this case it is better to get the nudge letter than not get it. (As getting it gives your client the chance of avoiding being on the STA list per CIoT guidance etc.)

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By Bruce Roberts
03rd Apr 2017 15:19

Thanks to 'gordo' for putting in the effort to submit a Freedom of Information request. It seems to confirm all our suspicions that this was just a generic 'nudge' letter.

In that case we can, I suppose, safely ignore the letter as simply scaremongering. However, that misses the point that HMRC deliberately lied to thousands of professional accountants to put the fear of god into them and their clients. This is no way to run a government organisation and whoever was responsible for this letter should be severely sanctioned.

I wrote to HMRC asking for details of the clients they refered to as being under investigation and got a reply today which said I could check the legislation by looking at factsheet CC/FS38. I have written back advising that they have misunderstood my letter and asked them again for the details of the clients they are referring to.

I cannot help thinking the ICAEW, ACCA and CIOT etc should be tackling this wholly unacceptable behavior.

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By gordo
03rd Apr 2017 19:25

Hello Justin

I understand what you are saying and I would agree if HMRC were simply providing a public service to make all accountants aware of this legislation.

That clearly was not their purpose.

HMRC need to be made aware, despite what Politicians may tell them, lying in order to achieve your objectives, is simply not acceptable.

I agree that the Professional Institutes, such as CIOT, ACCA, ICAS, ICAEW should be taking HMRC to task over this and asking them to explain their approach.

Of course, now that we understand that they are prepared to tell lies...

Imagine that the shoe was on the other foot and your client was caught telling a lie to HMRC to suit their objectives.

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