HM Revenue & Customs (HMRC) has developed a specific approach
to dealing with large business customers based on an understanding
of their particular needs and how they respond.
The current model of relationship management is an efficient risk-based approach
to dealing with tax matters and goes back to the 2006 Review of Links
with Large Business, in which large businesses identified their priorities
from HMRC as certainty, clarity, proportionality and speed of resolution,
underpinned by high levels of professionalism and commercial understanding.
2006 Review of Links with Large Business (PDF 242K)
In 2010 HMRC conducted interviews with businesses, representative bodies and
stakeholders to supplement the customer feedback gathered from the
large business customer survey and to understand better the continuing
needs of large businesses. Using this evidence HMRC set out the following
objectives which it aims to have fully delivered by the end of 2014-15:
- HMRC will continue to invest in a resource-intensive, relationship-managed
service for the largest customers, because the money and complexity
involved make this the most cost-effective way of getting the right
tax agreed early.
- All parts of HMRC will work with a common set of risk priorities
to focus on the highest risks. HMRC will allocate resources according
to risk by customers' behaviour, by threats to regimes and by size
- In dealing with those who bend the rules, HMRC will prioritise
upstream effort to resolve the problem at source: first aiming to
change behaviour through policy design and disclosure, then through
rigorous case work and where possible within established relationships,
and finally, where appropriate, through litigation.
- HMRC will always seek to work through issues in real-time with
all customers no matter what their tax strategy. This provides earlier
certainty for the customer but also allows HMRC to detect avoidance
- HMRC customers should have or buy in the skills to fulfil their
ordinary day to day tax compliance requirements. HMRC will provide
assistance to resolve uncertainty around complex or significant issues
and commercial transactions.
- All processing for large business customers will be via the normal
channels. All contact, compliance interventions and exceptions will
be co-ordinated through the Customer Relationship Manager and Customer
Co-ordinators, ensuring a coherent approach to customer management.
Large business customer survey (PDF 793K)
What HMRC will deliver by 2015
Customers with a Customer Relationship Manager
By fully delivering these six strategic propositions, HMRC’s aim is that most
customers with a Customer Relationship Manager (CRM) might say the
following in 2014-15:
- I am up to date with all years closed up to 2012, apart
from an issue on EU law that we are litigating. It was difficult
to get there, but we achieved it through a willingness on both sides
to face some tough decisions.
I work with HMRC daily on many significant and commercially important
issues - whether HMRC has raised them or because I have raised them
because I want commercial certainty. Only rarely does something take
longer than expected to resolve, in which case I am made aware of
The main method of communication is now face-to-face or telephone
rather than letters. HMRC is transparent about its thinking - where
it differs from ours HMRC explains why. I feel that HMRC listens
and wants to understand our position.
I get a sense that HMRC has a real grasp of the key tax risks from
the questions I'm asked. HMRC's officers show a marked improvement
in their commercial understanding, applying their tax knowledge to
my business and asking about the right things.
There is a noticeable improvement in the way that they deal with
all risks, in particular with VAT and on Employer Compliance risk
issues. HMRC is now much more proactive and drives the risk agenda.
The CRMs have improved their focus and I can see a real step change
in their confidence and skills in meetings, whatever the tax issue.
My relationship with HMRC is professional - we are open with each
other and there is trust on both sides. In particular, I can discuss
all our potential tax planning opportunities transparently with my
CRM in real-time. There's no point in not being transparent and we
all want to protect our working relationships.
I may buy good ideas from the Big Four/Magic Circle (or other agents
and advisers) to ensure that my effective tax rate remains competitive.
Even so I avoid aggressive schemes because our relationship with
HMRC is too important to risk losing it for a one off saving. Additionally
being re-categorised as a non-low risk business is unattractive as
I know that HMRC will pursue all risks vigorously.
I only contact my CRM when I am dealing with issues that are particularly
complex or significant, otherwise my day-to-day tax affairs are managed
in-house or through an agent.
The big change from recent years is the CRMs' interaction with their
technical specialists. I feel that the CRMs now have a grip and are
firmly in the centre of everything so that discussions are focused
around our business and what is important for us. They make sure
we all understand each other, and that issues are resolved as quickly
I feel I am consulted and have a voice - either through the CRM or
directly - in changes that HMRC makes and in wider policy change.
Customers with a Customer Co-ordinator
By fully delivering these six strategic propositions, the aim is
that most customers with a Customer Co-ordinator (CC) would say the
following in 2014-15:
- I am up to date with all years closed up to 2012. Only rarely does
something take longer than a year to resolve and that's a great
improvement. I am always fully informed on the progress of my issues.
- I work with HMRC on significant and commercially important issues – whether
HMRC has raised them or I have because I want commercial certainty.
- HMRC uses appropriate methods of communication such as telephone and
email mainly, rather than letters. HMRC's officers are open about
their views and where they differ from ours they explain why. I feel that
I know who to contact within HMRC and that when I do they actively
listen to me, seek to understand my position and when necessary
put me in touch with the right experts.
- When I deal with tax specialists I get a sense that HMRC has a real
grasp of the key tax risks from the questions I am asked. Although
contact is not regular, HMRC's officers show a marked improvement
in their commercial understanding when I do speak to them.
- There is also a noticeable improvement in the way that tax specialists
deal with all risks, in particular those that are associated
with VAT and Employer Compliance risk. When the specialists ask questions they
make it clear what the perceived risk is and concentrate on the
- My relationship with HMRC is professional. We are open with each other
and there is trust on both sides. There's no point in not being
transparent - they would soon know if I was being less than frank.
- Whilst I may buy advice from tax agents to keep my effective tax rate
competitive, I won't buy aggressive schemes. I can see that there
are clear downsides which outweigh the benefits of a one-off saving. Being
classed as non-low risk is unattractive as I know that HMRC will
pursue all risks vigorously.
- I only contact my CC when I cannot find answers from the usual channels
or I need help finding the right contact in HMRC. Otherwise I
manage our day-to-day tax affairs in-house or through my professional advisers.
- The big change from four years ago is that I have a named point of
contact responsible for co-ordinating all contact with me and
our business. The CC is aware of the various contacts that I have across the
of HMRC and has an overview of my business and risk status. The
CC helps to ensure we all understand each other and that communications
are joined up. When things go wrong the CC helps get issues resolved
as quickly as possible.
- I feel I know how to comment on changes when HMRC consults businesses
and on wider policy change - either through the CC, my professional
adviser or directly through consultations.
Litigation and Settlement Strategy
The Litigation and Settlement Strategy sets out the principles within which HMRC
handles all disputes about taxes, duties, credits or related interest
and penalties, where those disputes are subject to civil law procedures,
and whether disputes are resolved by agreement with the customer or
Litigation and Settlement Strategy (PDF 28K)
Taking a programme approach to the highest risk cases
For the very highest risk cases HMRC puts in place dedicated project
teams and engages with its customers at Board level through the High
Risk Corporates Programme (HRCP) and Managing Complex Risks Programme
For further information see the High Risk Corporates Programme.
The High Risk Corporates Programme