Accountants dismiss new TaxLab tool for taxing topicsby
Tax is complex, and explaining the intricacies of various tax policies can be confusing for both parties involved. But an attempt by the Institute for Fiscal Studies (IFS) to demystify tax for tax novices has not impressed accountants.
The Institute for Fiscal Studies (IFS) has launched a new online TaxLab tool to help tax novices understand complicated policies.
Many small businesses have no idea of the inner workings of some of the most basic of tax policies. When it comes to getting the details right, this lack of background knowledge can make it difficult to let clients know what’s going with their tax liabilities, especially in the current climate of predominantly screen-based communication.
The IFS launched its new tax informative tool to address this knowledge gap. The IFS TaxLab is an immersive website filled with articles and resources exploring the nitty gritty of tax policies and explaining it all in plain English to make the detail accessible to tax muggles.
The site takes you through a range of policies including income tax, national insurance contributions, and corporation tax includes downloadable resources about the wider the tax system.
The IFS introduced the TaxLab as part of its mission to “to provide better access to impartial information about how the UK tax system works, the effects it has on different people and businesses, and the options for reform. Everything on the site is either a verifiable fact or a conclusion drawing on the best possible evidence.”
The aim of TaxLab is to help small businesspeople better understand UK tax law and reduce the headaches of having to untangle the legal language it themselves.
Accountants not convinced
However, the accounting community was not entirely on board with the IFS tax policy tool.
Although it seems a helpful idea, some doubted the rationale behind its creation: “In the 35 years since I left HMRC and started working in practice I have never once encountered a client who was interested in having tax policy explained,” commented AccountingWEB member TaxTeddy.
Clients were far more interested in the law that needed to be applied rather than the policy that brought them there.
“Do we need another London-based, London-educated, London-centric body telling the rest of the UK how they think taxes ought to work?” questioned another member. “I’m not going to be referring anyone here because I disagree with their opinions, and it's not really a useful tool for providing facts on the tax system when the opinions are interspersed with no real indication as to what’s fact and what isn’t. I can do a better job explaining what my clients need to know myself.”
Owner and CEO of Avery Martin, Glenn Martin, was confused after reviewing the TaxLab with various clients: “I don’t really get it or what they are trying to do. All the data stuff, like how the government spend the money, is of little interest to most people and a Google search would be for those that do.
“They don’t really offer anything anyone with common sense would not know. People want to know useful information like how a car is taxed, how pensions work, or how to save tax. I don’t really know who the site is aimed at.”
As AccountingWEB member David Gordon put it, “If - Heaven forfend - I really do need to explain a tax point to a client, the last thing I do is quote tax rules. Unless I do wish the client's eyes to glaze over as they slip into a coma.”
Will you be using TaxLab to explain those tricky tax tips to clients? Let us know by commenting below.