HMRC Is Shite

HMRC Is Shite
Dedicated to the taxpayers of Britain, and the employees of Her Majesty's Revenue and Customs (HMRC), who have to endure the monumental shambles that is HMRC.

Tuesday, 28 March 2017

Tyrie Still Doesn't Believe The HMRC MTD Hype


In February I wrote:
"Treasury Committee chairman Andrew Tyrie has written to the financial secretary to the treasury, Jane Ellison, requesting further detail on HMRC’s claim that the Making Tax Digital programme will cost only £280 per UK company to set up."

Yesterday the Treasury Sub Committee reported that Tyrie has received replies from Jane Ellison MP, Financial Secretary to the Treasury, and Mike Cherry, National Chairman of the Federation of Small Businesses (FSB), on the compliance cost of Making Tax Digital.

Chair's Comments

"There are huge differences between the FSB and HMRC about the administrative burden of Making Tax Digital. This is the heart of the matter. The FSB think that with MTD, businesses might spend three times as much time on their tax obligations as they currently do. This could cost them around £3,000 a year in time, salaries and accountants' fees. HMRC think that they will spend less time, leading to a small net saving. A comprehensive pilot should shed some light on which assumption is closer to reality.
This serves to illustrate the need for the implementation of one of the Committee's recommendations that a comprehensive pilot is needed to establish the facts, and before mandatory roll out of the digital regime. I have written to the Administrative Burdens Advisory Board to ask for a view on the basis of their members' extensive business and accountancy practice networks."
In other words, Tyrie still doesn't believe the MTD hype!

Oh, and with good reason. As Kevin Reed notes:

As an ex KPMG person myself, I don't call into question KPMG's professionalism. However, "small" to them may not cover all genuinely "small" businesses!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Thursday, 23 March 2017

HMRC Issues Wrong Advisory Fuel Rate


Fleet News reports that HMRC has issued an apology after fleets were given the wrong advisory fuel rate (AFR) following a quarterly update.

The new rates, which are published on HMRC’s website, initially showed that the figure for petrol-engined vehicles above 2000cc had fallen by 1p per mile (ppm), from 21ppm to 20ppm, and the rate for LPG vehicles above 2000cc had increased by a penny a mile, from 13ppm to 14ppm.

However, after the new rates had been widely circulated and employers had updated payroll systems ahead of the March 1 change, HMRC amended its figures again. This time it showed that the petrol rate had increased by 1ppm, not fallen as originally stated. The new rate would therefore be 22ppm.

The increase to 14ppm for LPG vehicles above 2000cc remained effective from March 1.

An HMRC spokesman said:
We had previously published an incorrect figure of 20ppm and apologise for the error.
However, Debbie Floyde, a director at fleet representative body ACFO and group fleet and risk manager at Bauer Media, told Fleet News:
Publishing the wrong advisory fuel rate will have caused a major payroll headache for hundreds if not thousands of fleet operators. 

What’s even more frustrating is HMRC didn’t publicise the fact it had made an error, potentially leaving some employers still using the original figure.” 
To err is human, and HMRC has apologised. However, not to draw publicise the error and leave some in the dark is not very "sporting" of HMRC!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Wednesday, 22 March 2017

HMRC Inserts Errors Into Tax Returns


Seemingly HMRC is introducing errors into self-employed individuals’ tax returns, resulting in their failure to pay sufficient National Insurance.

According to the Telegraph, the errors relate to changes to the NI system announced by the previous government. From April 2015, workers’ “Class 2” National Insurance contributions have been declared on self-assessment tax returns. Previously they had been paid to HMRC by direct debit.
The £2.80 per week charge is supposed to be paid by all self-employed individuals and partners in partnerships, and counts towards individuals’ entitlement to state pension and maternity leave.

However, many taxpayers now find that where they submitted tax returns that correctly reported their Class 2 NIC liability, HMRC is actively “correcting” such returns by removing the Class 2 NIC liability. This appears to be “because the self-assessment system does not expect it to be paid”, accountants speculated.

George Bull, a tax expert at accounting firm RSM, said he and his colleagues initially detected a few cases of this error and were now seeing new incidences emerging on a “daily basis”. It was not affecting every self-employed individual’s return, Mr Bull said.

HMRC’s frontline staff have acknowledged the errors to accountants, and say they are due to a “technical fault” with HMRC systems that has been “reported internally”.

The concern is that individuals will either not spot the “correction” made by HMRC or believe that the removal of NI contributions from their return is correct.

“The problem is self-employed who file who see an adjustment coming through, which is probably in their favour and small – the risk is they will breathe a sigh of relief and think they don’t owe HMRC any more and leave it at that.

Then after 30 days, on the face of it, the whole thing is final. The issue is not so much the repayment itself, but the fact that if the NIC record is amended to show zero contributions for a year, people risk losing benefits as their record will become incomplete.”

HMRC initially denied the problem.

It later admitted the errors, but claimed that they affected only a “handful of people”.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Tuesday, 21 March 2017

Longest Finance Bill Ever - Never Mind The Quality Feel The Length


The longest finance bill ever, coming in at a stonking 762 pages (plus more than 400 pages of explanatory notes) was published on March 8th.

John Cullinane, tax policy director at the Chartered Institute of Taxation, is quoted by Andrew Goodall:
 “Today’s finance bill is the longest on record, beating the next longest by a country mile. This rate of change and quantity of additional legislation will make life more complex for taxpayers and tax advisers alike.” 
However the Office of Tax Simplification has said that we have nothing to fear, noting that while the length of tax legislation can give the impression of complexity, longer legislation can be easier to understand.

Got that everyone?

If you can't understand it, it's not the fault of the legalisation it's your fault!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Monday, 20 March 2017

Lords Call For MTD Delay


As loyal readers are well aware, Making Tax Digital (MTD) will be a clusterfuck. As such it is heartening to hear that others also know this.

‘The Draft Finance Bill 2017: Making Tax Digital for Business’ published lats week by the House of Lords Select Committee on Economic Affairs, Finance Bill Sub-Committee.1 calls for MTD to be delayed.

The Lords conclude that the roll-out of the scheme is being rushed, imposing unnecessary burdens on small businesses and landlords, and will yield little benefit to the Government. They call for a delay to the scheme until 2020 to allow for a full pilot.

The question is, will HMRC and the government listen?

It is clear that HMRC won't listen. However, the government now facing several years of Brexit overload may well jump at the chance to put this on ice.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Thursday, 16 March 2017

HMRC's Creative Tensions


In May 2016 I wrote the following about HMRC's plans to ditch Verify:
"Well now, here's a funny thing it appears that HMRC is pushing ahead with its own plans to build an online authentication portal following the decommissioning of the current Gateway portal in 2018.

This portal will be able to authenticate businesses, something the Government Digital Service's online authentication system Verify cannot do.

What is so "funny" about that I hear you ask?

Well it transpires that HMRC doesn't want the Cabinet Office to know that it's doing that.
"
In February this year I wrote:
"HMRC has confirmed that it will go it alone and develop its own identity assurance solution to replace Government Gateway when it ends in March 2018 – rather than using the government’s flagship GOV.UK Verify."
Well now move forward a few weeks and it transpires that HMRC will use Verify in conjunction with its own system.

Eh?

Computing explains it thus, HMRC programme director Mike Howes-Roberts published a blog post which initially stated that HMRC would not use GDS's Gov.uk Verify system, and instead develop their own solution in house.

HMRC then swiftly edited the blog post to then suggest it would continue to use Verify as the single identification service for individuals - and that the authentication service that HMRC is developing to replace the 16-year-old Government Gateway would complement the existing Verify service for business representatives.

The assumption that most onlookers made was that the Cabinet Office politely asked HMRC to amend the wording of the blog to diffuse speculation about an ongoing turf war.

It seems that this has all been just a matter of "creative tension". Ed Garcez, the chief information and digital officer (CDIO) of Camden, Haringey and Islington councils, has dubbed the ‘turf war' between HMRC and the Government Digital Service (GDS) around online identity assurance as merely a matter of ‘creative tension'.
"It's sometimes the case where you have technical professionals who work hard on a solution and put their all into it, they inevitably feel it's a great thing they've created. When there are two conflicting great things, it's people's natural tendency to try and sell the one that they've created. I don't think that's a constructive process, but it's a human process." 

I think if we can bring the learning of Verify and Government Gateway, as well as the other identity initiatives across government, together then there would be a clearer picture of what the best way forward is.

I would describe the current situation as ‘creative tension', because there is a degree of tension but I think if the tension is channelled in the right way it can be creative and can lead to a better result overall."
Well this all sounds fine then, clearly taxpayers and HMRC will end up with a system that is:

- efficient,
- economical and,
- effective!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"