A couple of years ago Jennifer Adams attended a seminar given by HMRC when Alternative Dispute Resolution (ADR) was in its infancy. She looks back here on how the new approach has evolved.
The Alternative Dispute Resolution (ADR) has been available to the taxpaying public for over two years now. When the service was tested as a pilot scheme a few years ago, there was no guarantee that it would continue. However the pilots went well enough that HMRC decided to continue with it
Therefore, when CIOT/ATT announced that HMRC were asking for members to test drive f a new addition to the service – a dedicated ADR helpline - it made sense to give it a try to see how ADR has been working in practice, and how it is likely to evolve. John Neale, a member of the HMRC ADR team, has also been in touch and answered some of the questions I had about the mediation approach.
How ADR works
The service is split into two separate schemes: one for smaller enterprises (SMEs); and the other the larger and more complex cases (L&C). HMRC’s ADR guidance explains the how the process works in more detail.
The main benefit is the obvious reduction in cost for both sides plus the facility for “both sides to sit back, take stock and with a trained facilitator see if both parties can solve a problem without the cost of going to a tribunal or further”, as Andrew Gotch of CIOT’s OMB sub-committee put it.
ADR commences with a request from the customer. The one-page online form only allows 2000 characters to set out the case details, but this is only a basic overview as the dispute will already be known to both sides.
After agreement to use the ADR service has been made, one of 20 independent HMRC facilitators is appointed. They will not have previously been involved in the dispute but the intention is that they will work with the taxpayer (and their agent/adviser) and the HMRC case worker to reach agreement. In a stalemate situation, an independent facilitator can act as a neutral third party mediator. To view the practicalities and procedure of the process see BDO’s ADR video mini-series.
About Jennifer Adams
Jennifer Adams is Consulting Editor of AccountingWEB and is a professional business author specialising in corporate governance and taxation. She runs her own accounting and consultancy business with offices based in Surrey and Dorset.