Trevor Shaw, RSM Bentley Jennison
Dawn Elliott, KPMG
Nick Mogford, Ernst & Young
Alistair Cliff, Deloitte
Giovanni Bracco, PricewaterhouseCoopers
Simon Baines, Deloitte
Steve Corrin, Baker Tilly
Shawn Healy, BDO Stoy Hayward
Mark McGarry, Saffery Champness
Keith Cartwright, Local Compliance
Ian Young, Local Compliance
Angela Brown, Business Customer Unit
Martin Hall, Local Compliance
Tracy Cottis, Local Compliance
Andy Coe, Risk & Intelligence Service
Matthew Powell, Local Compliance
1. HMRC welcomed attendees, thanked them for their attendance and commented on the value of these forum meetings to LC.
2. There were two action points noted: In relation to the debate on the use of estimates in returns, HMRC advised that the matter had been fed back to the team that deals with administrative burdens and is being considered by them.
3. An issue of clarity in the draft guidance on clearances had arisen. That guidance had been substantially rewritten and is now in a new guidance manual – the Non-statutory Business Clearances Manual, which is intended for internal and external use.
4. HMRC circulated PowerPoint slide printouts summarising progress with
the HMRC-wide implementation of RLLB proposals, and talked through the issues
identified. This stimulated a debate about cultural change and the impact
of apparently small issues. The importance of ‘tone’ and ‘respect’
was emphasised. One point emerged about the length of time it can take to
receive letters of a given date, emphasising some procedural issues which
could cause businesses and accountant's problems, particularly where HMRC
action was based on the stated date of issue rather than the actual date.
HMRC to take this forward as an action point.
5. HMRC summarised the major developments regarding implementation of RLLB
in Local Compliance. Particular issues that stimulated debate included the
planned timetable and numbers for the rollout of customer managers, and
how HMRC manage relationships for businesses without a customer manager.
Members were generally of the view that a designated contact point would
be appropriate.
6. Clearances pilot - HMRC advised that a low numbers of applications had been received. Members were generally of the view that the circumstances where an application would be warranted were not common on an individual business level, but it was important that when they did arise a quick and effective response was received.
7. SSE pilot – HMRC advised that the relationship of this with the clearances pilot was being considered. With regard to submission process, one member highlighted that some of the information required for general clearances was irrelevant to SSE applications. HMRC noted this and will factor it into the current review.
8. HMRC update regarding the implementation of proposal four of RLLB. Businesses
moving to LC from LBS, would have a consistent approach to that previously
adopted by LBS current risk assessments would not be re-visited.
9. The risk guidance being developed is based on the LBS guidance, but the
circumstances are such that there need to be some adaptations to cover the
structural differences between LC and LBS.
10. There would not be a ‘big bang’ in April 2008. The goal is to implement changes to the LC risk over the 2008-09 year. The first change would be to consider identification of the businesses that demonstrate high risk features. There would also be a need to identify which of the largest businesses should be classified as low risk. The decisions on risk status would be shared and discussed with the businesses.
11. For smaller businesses within the EU large population, risk profiling techniques will be used as indicators rather than as the prime determinant for an intervention decision. Where VAT visit are undertaken HMRC will move to a position of considering the need to look at governance and systems in selected areas and this will inform decisions on risk status. The need for HMRC to understand what good governance/systems look like and recognise that it will look different in different types and scales of business was noted. HMRC advised that work is currently being done on this.
12. HMRC referred to the paper on EC that had been circulated with the
agenda. A named EC tax specialist would be appointed to businesses with
a customer manager. Those specialists would be responsible for risk assessing
the employment taxes, consulting with the customer manager and feeding in
to the action plan.
13. For businesses without a customer manager, there will be a two-stage
process. Risk & Intelligence Service would continue to run projects
that would identify risks. Businesses where risks are identified will undergo
a second stage risk assessment. Action plans produced would be discussed
with the business.
14. HMRC would be intervening in respect of identified risks.
15. HMRC noted difficulties posed in respect of the large number of businesses for which we did not have information to determine the risk status. The intention is to undertake assurance visits on businesses for which potential risks had been identified as these will generally present greater uncertainty over systems and governance issues. Where errors are identified in the course of those visits, the business will be invited to rectify the matter and look to make any appropriate amendments to its processes. Where it is identified that errors result from failing to take reasonable care or deliberate action, HMRC would need to consider a formal intervention.
16. HMRC will need to consider the position across other tax regimes when undertaking a review.
17. It was noted that businesses might not readily appreciate the difference between a new compliance review and an old assurance visit. HMRC noted that this would become apparent as compliance reviews are undertaken.
18. New guidance will be issued shortly.
19. HMRC explained that the forum had been set up on a pilot basis and the intention for its future/direction to be reviewed about now. The forum had so far had a significant focus on RLLB and the plans for its implementation. The consensus was that the forum should continue and all parties should be more proactive in bringing issues/agenda items to the meetings. The concept of sub-forum meetings to cover specific issues in more depth was noted as a possibility.
20. There were no matters raised.
RLLB Local Compliance Programme Team
28 March 2008
