Communication is the key to a successful tax system – and now is the time for HMRC to get its messaging right, writes Tony Margaritelli.
Welcome to the latest edition of HMRC EIP magazine.
A simple stroll through LinkedIn will reveal the depth of problems agents, accountants and specialists are having in the R&D world and the angst/ anger/suspicion/concern that HMRC have allowed to fester as they sought to gain some sort of stranglehold on the topic and to try to staunch the losses that have been staggering in value.
The demands for repayments irrespective of their merits has left claimants staggered as they thought, like any normal person would, that a payment made to them on behalf of a claim was an acceptance of the validity of the claim – to coin a phrase, jobdone, move on, and spend or invest the money.
Get the message right
Sadly, we all know too well that such a simplistic assumption was wrong, and many businesses are now finding this lesson very hard to accept. And who’s fault is that? HMRC seem to have a problem with publicising and explaining their work; no matter how basic or difficult the subject matter, they struggle. Just look at how they try to explain a tax code change.
The recent report from the Administrative Burdens Advisory Board highlights quite clearly that ‘customers’ (their word not mine) “are having more difficulty reading and understanding HMRC communications than last year despite work being done within HMRC to improve this”.
HMRC must explain their actions so that they can be understood. If they are understood and the recipient accepts the explanation will that in itself reduce admin costs and additional costs down the line?
Naturally it would, but why are HMRC so bad at getting their point across? Could it be that they are seldom driving the narrative, seldom anticipating problems, and as a result are spending more time and money trying to dig themselves out of a hole?
Simplistic assumption
HMRC need to take a root-and- branch look at all their avenues of communication and make sure that, as basic as it sounds, they explain clearly, concisely and in a manner that is unequivocal. They must stop trying to ape the younger generation on TikTok and LinkedIn, with youthful presenters using cheery words – as if taxation was a product to be sold by shiny happy people, because it’s more important to take the time to get the message right.
As accountants or tax agents we are buoyed by the additional investment in HMRC because we want to believe it will result in an improvement in the services provided, and help sort out the scheme inventors and the serial avoiders. We want to believe it will make day-to-day interactions better, and where a problem is encountered provide a means to reach a sensible conclusion. But will it? As they say, time will tell.
- Tony Margaritelli is the Publisher of HMRC EIP magazine. Email him at Tony@hmrctaxinvestigation.co.uk