Rebecca Cave tackles new HMRC charter
HMRC has amended the document they refer to as “Your Charter” which was first published in 2009. It replaced the Inland Revenue Taxpayer’s Charter which was published in the 20th century.
It seems poetic that the wooden panel bearing the respected Taxpayer’s Charter was mysteriously lost when the newly formed HMRC moved out of Somerset House on The Strand. The charter (whatever it’s called) is important as it governs the relationship between HMRC and taxpayers, and also the separate but important relationship between HMRC and the taxpayer’s representatives.
I am concerned that the relationship between the taxpayer and the tax authority looks very different under the new charter compared with the old. I have set out the old and new obligations for each party under the charter in the tables below. The new obligations are matched where possible to the equivalent old wording.
|Old Charter||New Charter|
|1. Respect you||1. Respect you and treat you as honest|
|2. Help and support you to get things right|
|3. Treat you as honest|
|4. Treat you even-handedly|
|5. Be professional and act with integrity||3. Be professional and act with integrity|
|6.Tackle people who deliberately break the rules and challenge those who bend the rules||7. Tackle people who break or bend the rules|
|7. Protect your information and respect your privacy||4. Protect your information and respect your privacy|
|8. Accept that someone else can represent you||5. Accept that someone else can represent you|
|9. Do all we can to keep the cost of dealing with you as low as possible.||2. Provide a helpful, efficient and effective service|
|6. Deal with complaints quickly and fairly|
The new charter takes the emphasis off costs, and instead highlights “efficiency and effectiveness”. This means HMRC will deal with information quickly and efficiently, but doesn’t aim to answer the phone quickly or efficiently, although the detail in the new charter does say “and keep any costs to you at a minimum.”
The other omission that worries me is number 4: to treat taxpayers even-handedly. Under the new charter this obligation appears to have been rolled into number 1: respect you and treat you as honest. However, I feel that a lot has been lost in this new interpretation as the old charter said HMRC would:
- act within the law and our published guidance
- help you understand your legal rights
- explain what you can do if you disagree with our decisions or want to make a complaint
- provide you with information in a way that meets your particular needs
- consider any financial difficulties you may be having.
The taxpayer’s obligations under the old charter were very simple – just three things to remember. The new charter adds six new obligations. I can’t argue with numbers 3 and 4 as the tax law requires the taxpayer to keep accurate records, and to understand what their tax payment and filing obligations are.
However, I am not happy about number 2: work with us to get thing right. The detail behind this obligation says the taxpayer should: talk to us if there is anything you’re not sure about. Also under obligation number 3 the taxpayer is urged to: get in touch with us as soon as possible if you need help. Tell us straight away if you’re having trouble meeting your obligations. So the obligation is on the taxpayer to contact HMRC, but how is the taxpayer supposed to do that if HMRC won’t answer their phones or reply to letters?
|Old Charter||New Charter|
|1. Be honest||1.Be honest and respect our staff|
|2. Respect our staff|
|3. Take care to get things right||7. Take reasonable care to avoid mistakes|
|2.Work with us to get things right|
|3.Find out what you need to do and keep us informed|
|4. Keep accurate records and protect your information.|
|5.Know what your representative does on your behalf|
|6.Respond in good time|
The obligation that really sticks in my throat is number 6: respond in good time. This means submitting tax returns on time, paying tax by the due date and paying penalties and interest promptly. That is all reasonable for the taxpayer, but why is there no balancing obligation on HMRC to respond to letters in good time, answer the phone within five rings and refund tax without delay?
The HMRC goal of dealing with complaints quickly and fairly is not an equivalent to responding in good time, although it has been placed next to that obligation for the taxpayer.
The new version of Your Charter was not widely consultated on in advance (if at all?), unlike the previous version which was subject to extensive and detailed consultation. It was also slipped out in the middle of January, when many tax practitioners are working all possible hours to ensure their clients meet the self-assessment filing and payment deadlines.
I am not impressed.
Consulting tax editor for Accountingweb.co.uk. I also edit Bloomsbury's Tax Rates and Tables and write newsletters for other publishers.