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Where Taxpayers and Advisers Meet

Do we need to replace the people at the top of HMRC?

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm
Do we need to replace the people at the top of HMRC?

Postby etf » Sun Feb 13, 2022 7:55 am

The following article contained in Tax Adviser magazine struck a chord with me echoing my own experiences of trying to fathom out NRCGT filings. The cynical side of me leads me to think HMRC make processes as difficult as possible to increase their tax penalty income, but I suspect the real reason is the Department is just very poorly run. I suggest the public would like one page of simple step by step instructions detailing how to complete a filing/registration, but Bill Dodwell's article below highlights how badly HMRC are performing in providing such clarity. Does anyone at HMRC give any thought when providing guidance to the public and then get their granny to test it to see whether it is user-friendly? I think we need better minds at the top who put a team in place who ensure systems are rigorously tested before they are released to the public avoiding great stress and frustration.

The real-life impact of tax can be frustrating
27 January 2022

Dealing with HMRC and the real life impact of tax can be challenging and frustrating for those who do not share our level of expertise. It is time to make tax more accessible.

Key Points
What is the issue?

Everyone working in tax policy needs to gain a much better understanding of its real-life impacts.

What does it mean for me?

A self-employed person may not have a sufficiently recent payslip or P60 to verify their identity. We should ask if the process of registering for a government gateway account can be simplified.

What can I take away?

We need to remove barriers to make it easy for taxpayers to comply, rather than coming up with too many obstacles.


Children add a great deal to any parent’s life – but this isn’t an article about parenting! It’s about how children help anyone working in tax policy to gain a much better understanding of real-life impacts.

One of my daughters is a chef, and you can imagine that the pandemic has not been easy for many in the hospitality sector. The result was that she became self-employed – and therefore needed to notify HMRC and file a tax return.

The trials of registration
This should be easy – but the point of this article is to explain that it’s not. The first problem is that registration requires a government gateway account.

A quick search on ‘register for tax’ takes you to a page on www.gov.uk [1] entitled ‘HMRC services: sign in or register’ (see bit.ly/3ADspD6 [2]). This specifies that an individual needs to register if they:

want a personal tax account;
are an individual who needs to send a Self Assessment tax return (for example, to report rental, investment or self-employment income); or
have set up a limited company, or other organisation that needs to pay corporation tax.
The landing page doesn’t include a link to actual registration. Instead, there are at least four pages to read through before getting to the actual registration – and no doubt more if the intending taxpayer makes a wrong choice along the way. The key trick is to spot the link to something you don’t know you have – your ‘business tax account’.

Eventually, you arrive here, where the idea of creating sign-in details is given very little prominence.



A tangle of words
There’s no simple paragraph which says that an individual will need to register for a government gateway account if they don’t have one and then register for Self Assessment, whereupon HMRC will open a business tax account.

The language – Self Assessment, for example – isn’t designed to help chefs understand that this is the process for telling HMRC how much they’ve earned and paying income tax and national insurance. It only makes sense if you understand that since Victorian times the taxpayer made a return of income and the Inspector of Taxes then assessed the tax liability.

That position changed just before the millennium when (in theory) the tax authority required the individual to calculate their own tax, as well as supplying the information. In fact, of course, the Inland Revenue offered to do the calculations and today anyone using the HMRC website will find the calculations performed for them, whether they like it or not. Given there are many more chefs than tax specialists, perhaps our language should appeal to the larger group?

Further barriers
Moving on, registering for a government gateway account turns out to be very easy. The problem starts if you actually want to use it, when it is understandably necessary for the individual’s identity to go through verification.



A self-employed person may not have a sufficiently recent payslip or P60 – or even any at all. The P60 is for the last tax year (a P45 won’t do) and the payslip is not more than three months old. The credit record doesn’t sound like something a chef would have – and unfortunately HMRC does nothing to explain. In fact, most of us have some form of credit record if we have a bank account.

The chef of my acquaintance was convinced that she did not have a credit record and thus spent several weeks visiting the Post Office to register in person, using the In Branch Verification Service. This did let her into her HMRC account so that she could register for Self Assessment – and receive a letter with her UTR (unique tax reference) and a code a couple of weeks later. When the letter is received, the individual needs to log on again and enter the code in the letter – and finally they are allowed to tell HMRC about their income and pay the necessary tax.

When we were able to meet up, I was actually able to help the chef complete the government gateway identity check. The credit questions revolved around a time period when a bank account, credit card, phone contract or loan might have been taken out – by reference to less than a year; one to three years; three to five years; over five years; or not at all. It also required selecting a previous address from a list. Importantly, not having something was an acceptable answer. The value of the government gateway is that, unlike Verify, it is required by commercial software to file returns.

Should we not ask whether this could be simplified? Why does an individual need to register for Self Assessment, wait for a code and then enter it on the HMRC website? Does the code really serve any purpose? Could HMRC add some more identity sources to the government gateway process, such as a UK driving licence or council tax reference?

There’s a similarly annoying process for paying inheritance tax. You have to fill in a simple form (see bit.ly/3G0K0WD [3]) which just asks for the deceased’s name, NI number, dates of birth and death, and whether probate will be sought. If you do this online, the HMRC system immediately sends you a reference number by email – but that’s not the one you need to pay inheritance tax. Instead, you need to wait for an entirely different number to arrive in the post, three weeks later.

Isn’t it time that HMRC asked chefs to help it write its tax pages? Even though the pages I’ve mentioned seem to be written in a general style, they are actually full of tax jargon and take too long to get to the point. We need to remove barriers to make it easy for taxpayers to comply, rather than coming up with too many obstacles. Fintech banks also have to manage an identity process, but they have learned how to do it in a much more user-friendly way. Our tax system needs to benefit from their example.

Source URL: https://www.taxadvisermagazine.com/article/real-life-impact-tax-can-be-frustrating
Links

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm

Re: Do we need to replace the people at the top of HMRC?

Postby etf » Sun Feb 13, 2022 8:21 am

My observations below from 2016 about the NRCGT return....another example of a Granny test failure (and any other person with a pulse)


The layout of the form will not win too many design awards either with several sections headed:

“For funds and certain companies only”

“Ignore this section”

However, when you pass over those sections you subsequently notice they contain compulsory questions (*indicates required information).

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm

Re: Do we need to replace the people at the top of HMRC?

Postby etf » Sun Feb 13, 2022 8:56 am

Another example of why I believe Chef's have it easy (if I had a granny I think she would have resigned from her testing post or keeled over having read step 1 below). Who ever dreamt it up should be put in village stocks for a year and be subjected to wet sponge treatment:

Step 1: The client creates a Capital Gains Tax on UK Property Account

Many people have contacted us assuming that the ability to set up a Capital Gains Tax on UK Property account (a ‘Property Account’) is within the Personal Tax Account (PTA). It is not. It is an entirely standalone service which can only be accessed from specific pages on GOV.UK. It cannot be accessed from within the PTA.

However, it is helpful if the client already has a PTA as they can use the same credentials (i.e Government Gateway username and password) to set up their Property Account. We also understand that a sole trader with a Business Tax Account (BTA) instead of a PTA can use their BTA credentials to set up a Property Account.

Many people do not realise that an individual can use the same Government Gateway credentials for more than one service across GOV.UK. Alternatively, they can create separate credentials for each service if they prefer – although it requires them to remember more sets of user names and passwords and exactly what they have used each set for on GOV.UK.

For a client with existing GOV.UK credentials, they should follow the green ‘Start’ button from the Report and pay Capital Gains Tax on UK property pages and then sign in with those existing credentials. Creation of a Property Account should take less than five minutes.

If the client does not have any existing GOV.UK credentials, then they will need to set up a Government Gateway account first and verify their ID. They should follow the same green ‘Start’ button but then click on the link underneath the sign-in box which says ‘Create sign in details’ and then follow the steps on screen to set up their username and password, before continuing on to create their Property Account.

At the end of the process, the client will be issued with a reference number for their Property Account. We understand this will be a 15-digit number in the format XYCGTxxxxxxxxxx or similar. The client should make a note of this, as they will need it for future steps.

Note: A number of cases have been reported of individuals who have been unable to set up a Government Gateway because they have no passport or credit history and therefore - despite being otherwise quite capable of using the digital service - cannot get through the verification process. In these cases, these individuals (or their agents) will need to request a paper form.

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm

Re: Do we need to replace the people at the top of HMRC?

Postby etf » Wed Feb 16, 2022 5:03 pm

A few votes for Jim to go below.

I did think the same when I read that 43% of post receives a reply within 15 workdays statistic. Absolute balderdash from my own experience.

I see from Jim's email today (clearly rattled by that PAC report flagging the lack of any plan) that HMRC are shutting down telephones to concentrate on the post backlog. Suggest Jim puts MTD in moth balls instead.


By Mr J Andrews
14th Feb 2022 17:26
The buck stops with the CEO. Unfortunately unlike industrial / business organisations a failed , incompetent head honcho within HMRC stays put until his/her massive pension is due and usually with a bong to boot.
The current farcical incumbent pushing MTD says it all. Sadly the whole of HMRC are taking the flak for this sheer stupidity.

Thanks (4)
Replying to Mr J Andrews:
avatar
By Hugo Fair
14th Feb 2022 19:16
Love the image you've put in my head ... of Jimboy, dressed in full flower-power finery, and gazing dreamily at the members of PAC - whilst clutching his 'bong'!

Thanks (1)

By Arbitrary
14th Feb 2022 17:11
On customer service, I cannot recall ever in the last ten years getting a reply within 15 days to a letter to HMRC (even by the date on the letter of reply), How on earth did they come up with 43% success rate? As to phone calls I had to give up trying in 2020 because after a half hour wait I abandoned the effort; would this register as a call to HMRC? The figures quoted are clearly nonsense

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm

Re: Do we need to replace the people at the top of HMRC?

Postby etf » Fri Feb 18, 2022 2:21 pm

Someone attempted to defend Jim Harra. I tend to agree with the respondent.

"Let’s stop blaming the powers that be at HMRC for issues that are not their fault. The finger really does need to point a little further along Whitehall."

It is fair enough to identify why HMRC are in trouble but I definitely do not agree that the powers to be have not contributed to the problem. Those at the top should have flagged up the problems long ago and said honestly to the Government and the Public that the service cannot cope, instead of basically lying about how great they were doing.

Worst of all they pushed ahead with projects like MTD when any Accountant would have told them to shelve that project indefinitely and concentrate of what already works well and prioritise the problems that really matter.

It is also unforgivable that the very people that could have helped them, US, have been sidelined and largely ignored when we could have been on side with HMRC and worked with them rather than against them.

I am particularly offended that anyone should have sympathy with the powers that be in HMRC, it is entirely their fault that HMRC is in the situation it is and those at the top should take full responsibility for this. Better still, do something about it.

As I have said before on many occasions now, making MTD work is entirely the responsibility of HMRC, NOT US, and any sensible administration at HMRC would have shelved this project indefinitely long ago and concentrated resources where they were needed and also improved and developed existing systems that already work well.

So, sorry, no sympathy whatsoever for those at the top of HMRC who have failed us all and have left us with a service that is unbelievably incompetent and not fit for purpose.

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm

Re: Do we need to replace the people at the top of HMRC?

Postby etf » Fri Feb 18, 2022 4:32 pm

I'm typing this whilst I wait for HMRC to answer the telephone (the wait lasted just over 30 mins and I spent nearly the same again resolving my issue).

What the Taxpayer Charter says:

Making things easy
We’ll provide services that are designed around what you need to do, and are accessible, easy and quick to use, minimising the cost to you.


The Reality:
Letter received from HMRC-no telephone number detailed on the letter....WHY?
Google search and telephone the correct number, get that horrid automated system, wait an eternity and get through to the employer's helpline which is not where you wanted to end up. Wait again and finally arrive at where you want to be in 30 minutes instead of the 1 it should take.....so glad I don't have to complete timesheets... where do people dump this wasted time?

This is reality of Harra's HMRC and he is attempting to change the world when services are absolutely are at rock bottom. When the Department hits the MTD iceberg he will retire and leave somebody new to pick up his mess.

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm

Re: Do we need to replace the people at the top of HMRC?

Postby etf » Wed Feb 23, 2022 8:26 am

Another one of those 'ridiculous' posts from accountingweb......except this one is from someone as experienced as you will probably find. I do scratch my head that HMRC claims nearly half of post is dealt with within 15 days and yet this poster still has post outstanding from March 2021 (which echoed my own experience until very recently). If anyone from PAC reads this thread perhaps a question to pose to Mr Harra when you next meet him.

Probably a selfish comment here, but I am so glad that I am retiring later this year after 46 years in the profession. My biggest gripe by a long chalk is not awkward clients, it's not the ICAEW, it's not changes in Accounting Standards or tax law over the years, it's HMRC. I have seen them go from a below average department in the 1970s and 1980s to more than below average in the 1990s and 2000s, getting seriously bad in the 2010s, but for the past three years or so (and NO!!!! DON'T blame this all on Covid) being beyond an embarrassment. I have several "urgent" letters I have sent to HMRC from March - May 2021 still unanswered, despite me following each one up three to four times, error after error with what they do occasionally churn out, longer waiting times on the phone and the knowledge and calibre of their staff is laughable. Ask a question, get an answer. Phone back a few minutes later speak to somebody else there asking the same question as the first person sounded unsure and getting a different answer, then asking other qualified accountants and doing more research to find that they were both wrong. Penalties for taxpayers who are one day late, yet nothing from HMRC when they are 12 months+ late in replying and that is not an exaggeration.....and they have the audacity, yes the sheer audacity to refer to their disgruntled taxpayers as "our customers". I was brought up with the adage "The customer is always right" and that being a customer, one can take one's business elsewhere. The HMRC system is broken. Jim Harra should hang his head in shame. As a profession, we are too reserved, too stiff upper lip and too quiet to do anything in unison against HMRC, to say "enough is enough" to fight back, for agents and taxpayers en-masse to issue HMRC with Penalty Notices each time they make a mistake or delay replying, and HMRC know that and that is why they get away with it. So with a tinge of sadness, I am about to say "adieu" to the profession I have practised in for 46 years and once enjoyed and "hello" to retirement with a smug sense of inner-warmth in the knowledge that I will no longer be dealing with the most inefficient public department in the history of public departments. "Happy Retirement" wishes gladly accepted on a postcard or a Clinton's card.
My name's Ben Elton, Goodnight!!

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm

Re: Do we need to replace the people at the top of HMRC?

Postby etf » Wed Feb 23, 2022 12:34 pm

And just to throw paraffin on Ben's fire I've just waited 34 minutes and 57 seconds for a telephone to be answered. That is just not good enough.

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm

Re: Do we need to replace the people at the top of HMRC?

Postby etf » Fri Jan 27, 2023 10:51 am

Harra acknowledged that wait times this year have increased to 27 minutes, compared to 12 minutes last January, but he contended that around 65% of the calls to the self assessment helpline during the two weeks ending 8 January 2023 could have been resolved if the taxpayer used HMRC online services instead.
By ireallyshouldknowthisbut
26th Jan 2023 14:03
Wow.

That really is a big "F you" to tax payers and agents alike. Most of the calls we make to HMRC are attempting to correct HMRC's errors. We never ring for fun, just for a nice chat.

We do however make multiple calls where HMRC just cant fix stuff for months on end, if they did it right first time there would be no calls.

I think Jim needs to retire and stop embarrassing himself like this.

etf
Posts:1253
Joined:Mon Nov 02, 2009 5:25 pm

Re: Do we need to replace the people at the top of HMRC?

Postby etf » Fri Jan 27, 2023 11:00 am

Harra: By every measurable metric, we're terrible. It must be the "customers".
The "customers":


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