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Brian Redford of HMRC discusses two consultations – “Establishing the Future Relationship between the Tax Agent Community and HMRC” and “Working with Tax Agents: Dishonest Conduct" and invites TW readers to contribute their views.

Building our Future Relationship

Tax agents play a vital role in the delivery of the tax system. To recognise this critical role, HMRC has devised a Tax Agent Strategy which aims to improve and future-proof its relationship with agents in a way that cannot be achieved by merely changing processes.

The Tax Agent Strategy seeks to trust and empower agents to resolve their clients’ affairs with less involvement from HMRC, whilst ensuring that agents who act below the standard we would all expect are identified and helped to improve.

To this end, we recently published two consultation documents: “Establishing the Future Relationship between the Tax Agent Community and HMRC” which focuses on the aims of the strategy, and “Working with Tax Agents: Dishonest Conduct" which looks at those very few agents who act dishonestly. I am delighted to engage TW in a dialogue about how we each see our future relationship.

The consultation “Establishing the Future Relationship between the Tax Agent Community and HMRC” sets out three main areas where we are seeking views. The first involves HMRC acquiring a much better understanding of our agent community.

Currently tax agents need to provide very limited information in order to register with us. This means, for instance, that security checks when initiating telephone calls are necessarily more complicated and HMRC cannot direct information to support agents accurately. In future we would like to capture more information about tax agents when they enrol so we can target support more effectively and reduce the risk of fraud.

The second area where we are seeking views is on the creation of a self serve facility. We propose that, for basic transactions such as authorisation to act on behalf of clients, agents should be able to control the transaction from start to finish. We want to know: do other services lend themselves to this approach?

The final area for consultation is about HMRC’s creation of an “agent view” for each enrolled agent which brings together their details and those of their client portfolio, providing a clearer picture of their total engagement with us.

We are also asking whether the current model is the right one for the future or whether requiring qualifications, continuous professional development and some form of self-governance as a pre-requisite for giving tax advice, is a better way forward.

As part of the Review of Powers we have separately been working on how we should deal with those few agents who act dishonestly. The aim is to develop an effective civil approach to dishonest tax agents as set out in the discussion document and draft legislation “Working with Tax Agents: Dishonest Conduct”. Proposals include:

• issue of a dishonest conduct notice, where there is evidence a tax agent has dishonestly advised or assisted clients;
• a right of appeal against that notice;
• access to working papers of dishonest tax agents, subject to Tribunal approval once dishonest conduct has been determined;
• HMRC access to a third party’s working papers which are no longer in the power or possession of the tax agent; and
• a civil penalty on the dishonest tax agent and, where there has not been full disclosure, publication of the agent’s details on the HMRC website.

We have worked closely with representative bodies to address agents’ concerns about the earlier draft legislation. This new draft legislation has been developed to provide a proportionate response to tackling dishonest tax agents.

We welcome all views on both consultation documents by 16 September. Further details are available at Consultations

Brian Redford is part of HMRC's Business Customer & Strategy Directorate, and Lead for their Tax Agent Strategy.