We are in a perfect storm. Where do we go from here?

Back in June this year I wrote an article “Has there ever been a worse time to be involved in tax?” which included this “So in march this year the CIOT, AAT, ICAEW, ACCA, ATT, ICAS, CIMA, ICB, CIPP and STEP wrote a joint letter to HMRC and they said, amongst other things “We increasingly hear from our members about the severe delays, business disruption and frustration that has become a regular occurrence when dealing with HMRC. Businesses claiming repayments and reliefs are frequently waiting upwards of six months, straining cashflow. Time spent waiting on phone lines and sending chasing letters creates additional compliance costs that our members typically bear rather than pass on to their frustrated clients, but it is also an added cost for HMRC and ultimately, taxpayers”

Accountants in Practice, Payroll Service providers, Tax Specialists and yes Tax Dispute Agents were finding their work hindered by lamentable HMRC service standards and questionable HMRC Staff levels and abilities mixed in with a feeling that it was all about getting in Revenue to close a supposed tax gap.

Since then there has been an undoubted increase in kick back from the profession including all the major Institutes as concern grows about HMRC staffing levels and attitudes and in this issue alone we have the following from Anton Lane of Edge Tax on HMRC attitude “The notice was legally unenforceable. What is interesting is that not only did an officer prepare the notice but a senior officer approved the notice. Would that be two officers ignoring the legislation, the law, as well as their internal guidance? If this happened once, so be it, but it doesn’t, it happens on almost every enquiry” 

We have Matt Hall of Armadillo Academy lamenting HMRC’s treatment of taxpayers as evidenced by their what one can only describe as cavalier attitude to correspondence he highlights the following which we can all relate too  “we are sorry for the delay in replying to your letter of …… was and remains a templated opening to a vast majority HMRC issued correspondence. It is the hollowest of apologies.”

Dave Wase of PKF-Francis Clark says this about R&D Claims “this current situation cannot continue.  With their departure from the Charter principles and their own published guidance, HMRC must be drowning in a sea of complaints.  Cases must be heading toward the FTT based on ill-conceived HMRC conclusions.  HMRC must in some ways be desperate for these cases not to land in front of a tribunal judge as some of the letters are frankly appalling – we even have one that states that HMRC are unaware of, and cannot find, CIRD80525, their own guidance (it is their practice note for R&D units detailing their approach to handling claims).”

The ICAEW continued to speak out and on the subject of the Agent Dedicated Line they said “An important message that will resonate with many ICAEW members is that respondents continued to express a strong desire to speak to a human HMRC adviser. Satisfaction levels on response times for telephone calls remains low, with respondents being dissatisfied with the service for that reason. The response from HMRC “ from 2‌‌‌ ‌‌October 2023, we will no longer operate to a 10-minute service level on the ADL – waiting times may vary depending on how many agents are calling us at any one time – we know that a high quality of service is important to you, and removing the 10-minute call answering target will allow us to focus on improving the quality of service we offer” Social media output was stark questioning the 10 minutes and of course the tenor of  “will allow us to focus on improving the quality of service we offer”

As a rule Accountants and Tax specialists are pragmatic and phlegmatic people who recognise the values of working alongside and within the system for the benefit of their clients and are not prone to voice anger or dissent let along rant out loud. Our Institutes expect the highest standards from their members, rightly so, and have seldom been known to question HMRC other than in very muted and carefully considered terms. At the moment we seem to be in the middle of a perfect storm driven by a desire to see a fully funded, staffed and motivated revenue service with well qualified and experienced staff fully able to seek out and punish the evaders whilst also helping out those that are simply struggling to comply who genuinely do mean it when they say they value the work Agents do”. 

We, all of us, Agents and Taxpayers must maintain the pressure on HMRC to act appropriately, in accordance with the law and to do so in a timely and understanding way because if they do not how are we going to advise our clients? Or actually is that what the current HMRC hierarchy really want and profession that only acts and interprets tax law the way HMRC do?