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9am lowdown: HMRC closes 170 local tax offices

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12th Nov 2015
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Good morning. HMRC are back in the news again this morning, but on the bright side, the IFAC has some good news for the profession.

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HMRC closes 170 local tax offices

HMRC is closing all 170 offices in favour of 13 regional tax offices across the country.

The Daily Telegraph reports that this restructuring will lead to ‘thousands of its 56,000 staff’ being made redundant in the long term. The move to merge the offices is part of the Chancellor’s aim to slash £80m savings from HMRC this year.

The restructuring will leave no tax office in south west England west of Bristol.

Iain Sanderson, Senior Tax manager at PwC, questioned how this restructuring will help customer service:

Is this really going to improve customer service or help close tax gap? HMRC to merge 170 offices into 13 hubs https://t.co/3KNCQH2How

— Iain Sanderson (@IainSanderson74) November 12, 2015

A HMRC spokesperson confirmed the development to Reuters, saying the overhaul "will mean fewer, but larger and more modern offices that will help us to deliver better services to our customers and bring in more tax revenue for public services".

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KPMG under the cosh from US regulators

The US Public Company Accounting Oversight Board conducts annual audit quality reviews and publishes them every year.

KPMG’s 2014 inspection report was published a few days ago and in the words of GoingConcern.com, “It’s not good.” The inspection rated 28 of the 52 audit engagements it inspected as “deficient”, with the 54% deficiency rate a significant jump from last year’s 46%.

The application of Audit Standard Number 5, covering audits that integrate with technology-based internal control systems, was a consistent problem for KPMG, particularly where the controls applied to loans and revenue recognition.

According to GoingConcern’s ratings based on other PCOAB audit inspection reports, KPMG’s deficiency rate puts it at the bottom of the Big Four league:

  • Deloitte: 21%
  • PwC: 29%
  • EY: 36%
  • KPMG: 54%.

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Accountancy linked to prosperity

The IFAC has released a report which links the accountancy profession to national economic growth and improved living standards.

The study found that global regions with a higher share of accountants in total employment have a higher per capita GDP. The Global accountancy ecology also contributes to an estimated $575bn gross value added annually to the global economy. 

Fayez Choudhury, IFAC Chief Executive Officer, said, ““Professional accountants contribute to better information, reporting, measurement and decision making. When nations have a robust system to track the flow of money in government, within businesses, and between organizations, transparency and accountability are improved, organizations are strengthened, and economies are enhanced”.

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Community: CPD suggestions

AccountingWEB member query is a recently qualified chartered accountant and is searching for CPD suggestions that they can do for free. Query turned to Any Answers to ask the community what they do, and more importantly, for how many hours?

TerryD replied, saying: “we go on courses - they are not particularly fancy, in fact some are decidedly drab.”

What CPD training do you do, and what suggestions could you offer query? 

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Replies (12)

Comments for this post are now closed.

By The VAT Doctor
12th Nov 2015 10:08

Sad, but...

I'm an ex VAT officer and so can imagine how cheesed off they are. However, we all know that many many tax officers are not that effective in tax collection and are just seeing out their days until retirement - there have been countless opportunities to join the private sector and those who remained must have been aware this was on the cards. 

It mirrors what happened with the large accountancy firms, who also used to be everywhere and who are now in regional hubs.  The large firms also use regional hubs and sometimes overseas ones to prepare tax returns and CT comps and so it would be a bit odd if the profession moaned about this too much.

I really fear for the public service element though

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By SteveHa
12th Nov 2015 10:48

I feel for them

I'm ex-Revenue, and whilst I'm happy to shout at HMRC for delays and inefficiency, at no point is it a personal attack on the individuals who, by and large, do their best against a backdrop of increasing cuts and "savings". I'm glad I no longer work there, this will be incredibly worrying for an awful lot of them.

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By JimLittle
12th Nov 2015 11:24

way to go

I keep hearing about HMRC trying to cut costs and efficiency savings. This may just result in a even poorer service to both tax payers and their agents.  We are all know about the long waiting times.

The work force is already demoralised yet the government is also trying to ensure they increase tax revenue.  Unhappy employees is not exactly going to be motivated trying to fight tax evasion. 

Answer is yes get rid of the bad eggs, pay well for good people and sure they will recover more tax for you which will more than cover the extra costs. 

 

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By 0098087
12th Nov 2015 13:04

This is disgusting. A total shambles. It's about time we got rid of Osborne who just wants to completely decimate everything. Enough is enough. Joke..really is

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Replying to paul.benny:
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By John Wheeley
13th Nov 2015 15:15

Not Osborne's fault

The process has been going on for many years, for example the Inland Revenue joined up with Customs & Excise in 2005 under a Labour government.

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Chris M
By mr. mischief
12th Nov 2015 14:48

Hard yards

Soon no-one will be left in HMRC who is able and willing to do any hard yards.  I currently have 137 clients on my books including 66 limited companies.  In the last 6 years I have seen an HMRC person look through a client's records just TWICE.

And whilst I believe all my returns would stand up to an enquiry - 7 enquiries brought by HMRC seeking extra tax of £200k or so in those 6 years, total extra tax achieved in the enquiries £0.00 - I feel this effort on their part, if mirrored in the UK as a whole, is derisory.

I do risk assessments every year and the highest tax risk on those in my books is over £100k.  You'd think someone in HMRC could be bothered to at least kick the tyres.  It is all about cost savings and hiring monkeys, the last enquiry I had I found myself explaining the revelant clause of the VAT Act to the inspector brining the enquiry.

This is great news for my client base as it makes it even more likely I'll be able to run rings round the monkeys who survive these cuts.  But it is not good news in my view for the deficit which Boy George loves "dealing with" so much.

Maybe if he looked into his history books he would not be so keen on running a surplus.  The UK has achieved this 4 times since WW2, the last being 1989.  Each time a really nasty recession has followed.  Unless he believes his own hype that we are suddenly going to out-export Germany, the path we are on has all the hallmarks of another speculative property bubble saddling unfortunate new property owners with too much debt just as interest rates remind us all 0.5% was a temporary phenomenon, cue nasty recession.

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By 0098087
12th Nov 2015 15:21

There is a point where you cut too much, Oxfordshire being the case

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By ireallyshouldknowthisbut
12th Nov 2015 15:45

.

@Mr Mischief, I am staggered how few real enquiries we get.

I have not had a SINGLE enquiry into a limited company client in 12+ years, apart from two goodwill CG34 questions on incorporation about very large goodwill valuations, and we prompted those.  Both of which I won hands down.

Nearly all the "enquiries" we get are simply cases of missing entries for child benefit, student loans and P11D.  Ie basic data matching that used to be dealt with informally.  

The other sort of flat rate VAT threshold questions for client sailing close to the wind.

Quality of the staff is generally very poor. 

There seems precious little random sampling or fishing, which even if they don't come up with much at least "keep your honest" in terms of what you put through. 

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By cparker87
12th Nov 2015 23:35

fire service
I spoke with a client on this today who serves in t he fire service. They underwent a similar regionalisation... Calls went unanswered.

I have more faith in their ability to organise such a transition than hmrc given the life and death situation they deal in.

Considering declining quality, inability to take calls and general incompetence this is a very worrying news article.

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By trevv69
13th Nov 2015 13:31

the story of regionalised fire control is a relevant parallel
https://en.m.wikipedia.org/wiki/FiReControl

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Locutus of Borg
By Locutus
13th Nov 2015 17:46

I didn't realise HMRC still had 170 offices!

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Locutus of Borg
By Locutus
13th Nov 2015 17:48

Duplicate posting deleted

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