Martin Randall (MR) - HMRC
Chris Edge (CE) - HMRC
Alice Gunn (AG) - HMRC
Chris Orchard (CO) - HMRC
Sunita Choolun (SC) - HMRC
Tal Kalsi (TK) - BDO Stoy Hayward
Neil Grant (NG) - Coutts and Co
John Foxon (JF) - HSBC
Richard Jameson (RJ) - Grant Thornton
Anne Elmer (AE) - Association of Taxation Technicians
Sarah Wulff-Cochrane (SWC) - British Bankers Association
Mark Levitt (ML) - ICAEW
Tony Cohen - Deloitte
David Kilshaw - KPMG
There were no action points from the previous meeting.
MR introduced himself as the new CPR Head of Unit and explained that Keith Williams had now moved on to another role within HMRC. The purpose of the meeting was about proposed changes to CPTT including timelines and how this fits into the wider HMRC Change programme as set out in the Departmental Report 2008 (PDF 2MB) resulting from our organisational development prompted in part by the Capability review.
The Departmental report sets out our four operational groups:
One directorate within Personal Tax is Charity, Assets and Residence (CAR), which deals with areas including Trusts, IHT and Pensions. As many of these aspects interface with the very wealthy, for example through the entities they control, it has been decided to integrate the CPTT work within CAR.
CPTT was set up in the old Inland Revenue and has been going for abut
six years. Originally it was envisaged as a unit that would deal with
the complex SA tax affairs of high net worth individuals. In practice
most cases were selected on the basis of high income rather than complexity
or high wealth as originally envisaged. CPTT currently deals with approximately
42,000 high income cases plus about 60,000 expatriates more recently added
to the customer base.
MR explained as part of a continuous review, we are re-organising CPTT
to create a unit within CAR that will take responsibility for the most
complex/highest wealth individuals. The exact numbers are not yet finalised
but emerging thoughts are that this will be around 5,000 cases, retaining
some customers from the existing CPR customer base and bringing in others
who present complexity. The aim is to gain a better understanding of the
remaining constituency and thereby provide a better service to help customers
with very complex affairs and focus on the highest risks within those
cases.
These changes would mean:
Many countries have already put in place or are developing tax administrative arrangements to deal with their very wealthiest/most complex individuals. It is a topic currently being explored by the OECD. CO from HMRC is the UK representative for this project.
In January 2008 the Organisation for Economic Co-operation and Development (OECD) published a report entitled 'Study into the Role of Tax Intermediaries'. The study focused on the large corporate taxpayer segment but noted that its findings and in particular the concept of an 'enhanced relationship' may also have application to High Net Worth Individuals (HNWI) and to banks.
In March 2008 the OECD set up a focus group to carry out the follow up study on HNWI. The focus group consists of the following fourteen countries: Australia, Canada, France, Germany, Ireland, Italy, Japan, Mexico, Netherlands, New Zealand, Norway, South Africa, United Kingdom and United States of America. Separate work is being carried out in relation to banks.
The focus group has released a paper (PDF 373K) for public comment and this consultation process ends 31 December. In addition, the UK and Ireland will be jointly hosting a public consultation meeting on the morning of 4 December 2008 at the Treasury Building at 1 Horse Guards Road in London. An interim report is due the end of March with the final report being published the end of May beginning of June.
Further public consultation on the OECD study is planned at the beginning of February in Paris.
HMRC then invited attendees to discuss the proposals for HMRC outlined by MR. The following issues were raised and discussed:
It was agreed the best method of communicating the changes to CPR customers would be via agents as they would want to be responsible for advising their clients. Suggestions were:
ML suggested HMRC consider road shows with agents early in the new year.
AG asked whether this would be better done in the evening and attendees
thought it might be.
There was an appetite for an open dialogue between HMRC and attendees
thought the forum could be developed further.
The movement of Expat customers into Manchester will be during 2009-2010 and how we communicate this change to agents and employers has still to be agreed. We would definitely use the Expat Forum to help us with this process.
It was recognised that some HMRC staff may need training on 'softer skills' in their new CRM roles and HMRC would be taking this forward.
Where do the Non domiciles fit into the new unit?
MR advised HMRC were already looking at how it will deal with
the £30,000 charge as a separate issue
What about the recent centralisation of footballers, barrister
and entertainer?
AG said no decisions have been made on whether continuing to segment professions
within a new unit would be beneficial for HMRC or our customers and said
she would welcome the views of attendees on this matter.
Will a new unit of 5,000 cases mean that individuals will be
under greater scrutiny?
MR advised that HMRC is continually reviewing how we are organised and
the way we interact with customers. Through this new unit we intend to
develop a better understanding of our customers so we are able to provide
a joined up service and target our resource most effectively.
Will a customer be able to 'opt in' the new unit?
CO explained that the OECD report advises that some countries offer an
'opt in' process and for others it is mandatory. HMRC have not made a
decision on this.
What would be the ratio of customer to staff in the new Unit?
The ratio for CPR is currently approx 400. This is being reviewed but
will be less. Having a smaller base will mean we can develop and understand
our customers better.
Overall the feedback was positive with members recognising the benefits of a new Wealthy team.
It was agreed the forum should continue but that the membership may need to be reviewed. The next meeting would be in February when an update on progress can be reported.
The meeting closed at 12.00.
