Tax agents play a vital role in the delivery of the tax system which could not function effectively without them. They provide invaluable support to many taxpayers to help them comply with their tax obligations.
This area of the review's work started with consultation in April 2009 which considered how HM Revenue & Customs (HMRC) interacts with tax agents to ensure their clients' returns and claims are correct when submitted.
HMRC has since consulted separately on 'Establishing the future relationship between the tax agent community and HM Revenue & Customs'. This looked at developing a longer term Tax Agent Strategy.
Tax agents and advisers - a new relationship with HM Revenue & Customs
As part of this agent strategy HMRC must be able to tackle effectively those few agents who are found to be acting dishonestly. The Review is proposing legislation to allow HMRC to obtain the working papers of dishonest tax agents, penalise them and publish their details on the HMRC website.
The overwhelming majority of tax agents protect their clients' interests by advising them correctly and representing them in their dealings with HMRC.
But there is a small minority of dishonest tax agents whose actions can affect a larger group of taxpayers. HMRC needs to be able to deter dishonest conduct in the first place and penalise it when it does occur, whilst acknowledging co-operation and disclosure. It also needs to identify the scale of the dishonesty in order to be able to put matters right for the taxpayers whose affairs are incorrect.
As announced in Budget 2011 and following consultation over the summer, on 6 December 2011 draft legislation for inclusion in Finance Bill 2012 to address dishonest tax agents was published for comment by 10 February 2012.
Autumn tax updates and draft Finance Bill clauses
The legislation will be brought into effect by Treasury Order and is expected to have effect for dishonest conduct on and after 1 April 2013.
Working with Tax Agents: Dishonest Conduct - Summary of responses - December 2011
This document responds to the discussion document published on 14 July 2011.
Working with Tax Agents: Dishonest Conduct – Discussion document 14 July 2011
This discussion document asked for comments by 16 September 2011 on revised draft legislation to enable HMRC to tackle tax agents who act dishonestly in tax matters.
Working with Tax Agents: Responses to Consultation - July 2011
This document responds to the consultation document published on 9 December 2009 and the draft legislation published on 8 February 2011.
Draft legislation on deliberate wrongdoing by tax agents - February 2010
On 19 February 2010 HMRC announced that the deadline for comments on draft legislation on deliberate wrongdoing by tax agents, published on 8 February 2010, had been extended from 3 March 2010 to 28 April 2010 to allow additional time for interested parties to comment.
The draft legislation reflected the proposals in the consultation document:
Working with Tax Agents: The Next Stage - Consultation Document December 2009
This further consultation sought views on:
Working with Tax Agents: a consultation response document December 2009
This document responds to comments received on the initial consultation. It includes examples of how HMRC seeks to continue to improve its own performance.
Working with Tax Agents: A Consultation Document April 2009
This initial consultation considered how HMRC interacts with tax agents and asked whether changes could be made that would better serve UK revenue protection. It suggested design principles that might underpin the work, discussed the changing market for tax advice and how HMRC might respond to risks attributable to the tax agent rather than the taxpayer.
