Accountants have expressed concern over a new HMRC pilot scheme in Exeter which involves contacting local businesses directly rather than going through their professional advisers.
HMRC has launched a new pilot scheme in Devon which involves contacting business owners direct, to arrange a two day examination of their tax records, without reference to their professional advisers.
“This initiative may be aimed at distancing business owners from their tax advisers and putting them under aggressive scrutiny by the taxman”, warned Andrew Browne of South West based chartered accountants Bishop Fleming.
In a statement released today, an HMRC spokesman said: “HMRC recognises the important role that tax advisers play in business, and is not seeking to disengage their input from the process.
"However, HMRC remains committed to minimising the compliance costs to both the customer and HMRC, and to that end, has launched a pilot project in Exeter which aims to look at how compliance checks may be carried out more effectively and efficiently. This work will explore, amongst other things, the scope for contacting businesses by phone to arrange a compliance review”.
The spokesman explained that it would be a similar approach to an approach many SME business customers would be familiar with in relation to individual checks of VAT or PAYE.
He advised that the extent of agent notification would be dependent on the level of customer authority held. If HMRC checks taxes that the agent is not authorised to act on, it will only send out a brief acknowledgement that the client has been contacted in relation to a compliance check. The customer will receive a letter explaining this and saying they may wish to share the detailed letter with their adviser to discuss it in more detail.
The scheme is an ‘open pilot scheme’, which means it will be kept under review before being rolled out elsewhere. “No decisions will be taken until the outcomes of the pilot have been rigorously assessed”, added the spokesman.
“My advice is that any Devon business receiving this new direct approach should alert their accountants before responding”, added Andrew Browne.