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HMRC's conduct in relation to the concession which allows them to give up tax when they have taken too long to raise assessments (ESC A19) has long been roundly criticised amongst the tax profession. A lack of consistency and a failure to follow their own guidance properly is well known - how often, for instance, is ESC A19 considered automatically - before being requested by the taxpayer?*

HMRC recently issued a consultation Extra-Statutory Concession A19 Review which attempts to re-define the circumstances in which ESC A19 will be applied. It effectively tries to place greater responsibility on the taxpayer, for instance by requiring the taxpayer to request A19 within a set time frame (rather than to apply it without being asked) and undoubtedly means it will be applied less frequently.

TaxationWeb and Taxation magazine have each reported on tax advisor Paul McKay's most recent experiences as regards ESC A19.

There is evidence of growing concern - leading tax barrister Keith Gordon has started an online petition for tax professionals to show their opposition to HMRC's latest proposals:

"In the past couple of years, HMRC have attempted to reinterpret their own guidance simply to avoid applying the concession in the very cases for which it was designed. I ask fellow tax advisers to put their names to this petition, to add to the list of comments and to sign the petition itself. "

TaxationWeb has also started its own poll for taxpayers and advisers: Has HMRC Crossed the Line with ESC A19?

Mark McLaughlin, TaxationWeb's managing editor, said:

"We have been advising taxpayers about ESC A19 for many years. My perception is that HMRC's awareness of - and appetite for - the application of this invaluable concession have both steadily eroded over the last several years.

I know that my perception is shared by many of my colleagues in the profession and I expect they will also share my concerns about these latest developments. This concession was introduced with good reason and it has been around for a long time - again for good reason.

It is not so long ago that HMRC was forced to apologise for exactly the kind of delays for which this concession was introduced: millions of taxpayers were affected by annual reconciliations that HMRC repeatedly postponed for several years, and HMRC was forced to write off millions of pounds as a result - but only through this concession as it currently stands. The so-called 'clarifications' proposed in this consultation leave HMRC wide open to the accusation that they would rather change the rules than "do the right thing" in future. This hardly seems in keeping with the Taxpayers' Charter."

*(The guidance is now notably quiet on the point that HMRC should consider cases for ESC A19 without being asked but a hint still remains - see for instance, the following line from the Self Asessment Manual SAM101120 - Records: Maintain Taxpayer Record: HMRC Delay in Using Information:

"However, you may come across a case where you feel that the concession should be given (or where the taxpayer claims it)..."