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Accountant did not understand SA

24th Nov 2016
Editor AccountingWEB
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Numbers does not add up
istock_bowie15

An accountant lost a first tier tribunal appeal because he “did not understand how self assessment worked”, a tribunal judge ruled.

Mohammed Drammeh, trading as M&D Accountancy Services, “calculated” the amount of tax that he thought should have been deducted from his client, Bernard Bediako, and included that figure on the 2013-14 return, rather than using the information stated on his client’s P60.

On the 'employment page', Drammeh increased the tax due in the tax deducted box from the £1,212 shown on the P60 to £3,102. He then added in the ‘other information box’: “T Ltd employment – additional information. This employer declares wrong deduction on tax certificate and the PAYE records are inaccurate. Please investigate.”

When HMRC opened an enquiry into Bediako's return, Drammeh reasoned the SA return: “[T]here are repayments due in all and no payment due to HMRC; this is because of negligent by HMRC system of obtaining tax payers accurate data or employer’s malpractice for tax avoidance. Taxes have been deliberately misrepresented. (sic)” 

Since neither Bediako nor Drammeh responded to HMRC’s plea for evidence and an explanation of the figures used, HMRC imposed a penalty notice. When Drammeh eventually called HMRC in February 2015, five months after the information was requested, he said he was “under serious pressure and busy with work”.  

Later, Drammeh protested that HMRC’s was supported by “false and wrong information supplied by the employer” and that the “tax codes and payroll system is misleading and illegal”.

In April 2015, HMRC closed the enquiry, amended the self assessment form, and issued a penalty notice of £567.18 for carelessness. However, Drammeh requested the issue be taken to a tribunal. “I am not satisfy with you for the way of handling this enquiry (sic),” he wrote.

Made up his own calculations

When pressed by the tribunal [TC05054] in April 2016, Drammeh admitted that he made his own calculations. “On the gross amount I take into account any expenses due and any personal allowance and the tax based on the rate,” he explained. But he did not deduct expense figures or personal allowance.

The tribunal explained to Drammeh that the only information required was the tax deducted by the employer as shown on the P60 and how the numbers from the boxes fed through into the computation of his final liability. After hearing this, he acknowledged the figure was wrong.

Drammeh initially claimed the mistake was the result of miscopying the information, but he backed away from this stance once he was reminded of the extra information he provided on the form.

The tribunal recognised that Bediako had appointed an agent to act for him. But HMRC decided against reducing his penalty because, like Drammeh, he did not contact them either.

Judge Anne Redston said: “HMRC repeatedly made direct contact with Mr Bediako: he received the original opening letter; he was asked in that letter to provide his bank statements… We also observe that Mr Bediako knows generally how to contact HMRC: before instructing Mr Drammeh he regularly called to discuss his outstanding debt, and HMRC helped him to complete his 2009 tax return.”

The tribunal upheld the amendment and penalty, and dismissed the appeal.

As we approach self assessment season, Drammeh’s handling of his client’s tax returns serves as a reminder to accountants to be accurate when completing SA returns.

Replies (18)

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By Tim Vane
24th Nov 2016 17:30

I think I know this guy. Doesn't he regularly post in AA as "Anonymous"?

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By ireallyshouldknowthisbut
24th Nov 2016 17:48

Wow.

That was the polite version so Richard doesn't have to edit the swears. Stories like this make me feel almost competent.

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By AnnAccountant
24th Nov 2016 23:57

What can be done to stop him practising (literally!) and calling himself an accountant?

That's right - nothing!

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By SteveHa
25th Nov 2016 09:25

Practising? It doesn't even sound as though he read the introduction to the training manual.

God help his clients if he feels he's done enough practising and is ready for big boy stuff.

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Replying to SteveHa:
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By 356B
25th Nov 2016 15:56

SteLacca wrote:

Practising? It doesn't even sound as though he read the introduction to the training manual.

God help his clients if he feels he's done enough practising and is ready for big boy stuff.


There's a training manual? That'll upset PNL.
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By memyself-eye
25th Nov 2016 10:35

Hilarious..

I have a client I could send to him. Actually, two or three.

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By Rebecca Cave
25th Nov 2016 10:43

Note in para 99 of the case report Judge Redston says:
"Mr Drammeh trades as M&D Accountancy Services and he has other clients for whom he provides tax filing and related services. In some countries, such as
Germany, only those who have passed a specified professional qualification are allowed to give tax advice. But in the UK, a person can act as the tax agent for another person, and/or represent them in correspondence with HMRC, providing that other person has confirmed the agent’s appointment to HMRC in writing.

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Replying to Rebecca Cave:
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By Paula Sparrow
25th Nov 2016 11:27

taxwriter wrote:

In some countries, such as
Germany, only those who have passed a specified professional qualification are allowed to give tax advice. But in the UK, a person can act as the tax agent for another person, and/or represent them in correspondence with HMRC

This forum has been through that argument so many times before! Qualifications do not necessarily equal competence. There are some very knowledgeable advisors who have no initials after their name and some appalling advisers who have an armful of letters. How is the poor sop on the street supposed to know?

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By johnjenkins
25th Nov 2016 10:53

Did he ask for a review from his local takeaway?

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By mgdrobinson
25th Nov 2016 11:08

'Stories' like this always make me wonder if the professional bodies will ever lobby government to get the term 'accountant' protected so that the people who train and work hard are not put in the same category as someone who does not understand how self assessment works....

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By Ammie
25th Nov 2016 11:41

You gotta laugh...........and cry at the same time!!

Every walk of life has it's clowns.

What are his clients thinking when inviting him to act? It also explains what I hear often,
"My mates accountant only charges £75 (cash) and gets him back twice as much repayment"
To which I reply
"Then why waste your time and money sitting in front of me, I am clearly missing a trick somewhere, (NOT), you should go see that "professional" bye"
I don't deal with any nonsense from anyone, just show them the door and close the file.

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By Rosalinda Taylor
25th Nov 2016 13:05

Where did this so called accountant got his qualification?????????????????

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By justsotax
25th Nov 2016 13:31

of course had his trading name contained 'tax specialist' or something along those lines then I would understand the outcry from the qualified people....but of course, being a chartered accountant does not necessarily make you competent on the tax side.

Therefore by all means protect 'accountant', but I would also suggest 'tax adviser' should be protected...(otherwise the words 'cake and eat it' comes to mind)

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Replying to justsotax:
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By AnnAccountant
27th Nov 2016 21:27

justsotax wrote:

of course had his trading name contained 'tax specialist' or something along those lines then I would understand the outcry from the qualified people....but of course, being a chartered accountant does not necessarily make you competent on the tax side.

Therefore by all means protect 'accountant', but I would also suggest 'tax adviser' should be protected...(otherwise the words 'cake and eat it' comes to mind)

100% agree with you there. But I would as I'm a CTA!

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By jon_griffey
25th Nov 2016 15:39

I understand that the qualified v unqualified debate is well trodden ground. But seriously, why is it in this country that we allow anyone regardless of experience, competence or criminal conviction to set themselves up as an accountant, tax adviser etc and be let loose on an unsuspecting public? Despite this guy's incompetence there is no mention of anybody taking any action to intervene in his practice to protect his other clients so he just carries on regardless. I know that there are good and bad qualified and unqualified, but being qualified, at least you were assessed as competent at some point your professional life and have a professional body for people to complain to.

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By Mr J Andrews
25th Nov 2016 16:13

In my Inland Revenue days, sometime in the last century , the D.I. { District Inspector } kept a ''black book'' of the local rogue agents. Needless to say, some excellent back duty results ensued and life made extremely difficult for such incompetent wasters.
Now we have MTD proposals to make life less easier for all and sundry. Progress within HMRC doesn't quite stack up.

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By kenny achampong
25th Nov 2016 19:42

My friend, a director, used a well known West End accountant for his company accounts. His easiest personal tax return ever was done not only using figures from the wrong year, but a random amount was put in the tax paid box giving rise to a rebate of many thousands of £s which the chartered accountants got paid into their account. Not a word to him....and he didnt owe any bills...and it was just kept by them. It was literally 2 boxes to fill in...and worse than that, he got an invoice from them for £1,200 !! So let's stop banging on about qualifications...they are worthless.

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By In a Daze
25th Nov 2016 19:43

The official meaning of accountant " a person concerned with the maintenance and audit of business accounts and the preparation of consultant reports in tax and finance"

I believe Chartered Accountant is protected. I dropped my letters and joined ICPA i have seen good and bad both sides of the fence.

Many years ago i worked with a girl who achieved pass rates between 70-80% in her exams however, could not apply anything she had learned in the real world which in my opinion is where you learn how to do the job.

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