Local professional support - June 2018

Overstating your tax liability? On your head be it
What happens if you make a mistake on your tax return? If the effect of your error is to under-declare your tax liability, you face an HMRC investigation and having to pay the tax with interest and perhaps penalties.

Naming and shaming; HMRC must urgently explain their new penalty interpretation
Since the introduction of the new penalty regime for tax inaccuracies some 10 years ago, HMRC has hitherto encouraged taxpayer co-operation by being able and willing, where appropriate, to grant full abatement down to the minimum percentage penalty levels set out in tax legislation. 

Brexit puts brakes on taxman’s digital revolution
HMRC recently announced significant changes to some of its major projects as a result of the all-consuming need for its systems to be up and running for Brexit. Not surprisingly one of the major impacts has been on its digital transformation programme.

Employees and employers bear the brunt of increased liabilities on termination payments
The tax and National Insurance contributions (NIC) treatment of termination payments has always been an area which employers have struggled to deal with correctly, and over recent years HMRC has looked to simplify the rules. Following a consultation, the drafting of legislation, and the belated issuing of HMRC guidance, the rules changed on 6 April 2018.

HMRC’s handling of tax investigations under scrutiny
It's an old question, but who investigates the investigators? In the case of HMRC, it's the Treasury Sub-Committee of the House of Commons. In its day-to-day workings, HMRC deals with a wide range of investigations and tax disputes. Although HMRC has internal governance processes which are intended to ensure that it deals with all tax disputes fairly and in an even-handed manner, hardly a week passes without a tax tribunal making a finding against HMRC because of the way it has handled aspects of a dispute.

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