PublicEye
ANALYSIS
Enforcing standards vital to compliant accountants and small businesses
The government consultation into strengthening the regulatory framework in the tax advice market was a welcome sign that AAT’s Accountable campaign may bear fruit, says Adam Harper
The government says it is determined to improve clarity, transparency and enforcement around tax advice, and as part of the consultation, has suggested three possible routes to achieve this. By the time you read this, the consultation will have concluded, and we await the outcome with interest.
While it’s right that stakeholders consider the merits of a hybrid approach of joint HMRC-industry enforcement and the creation of a government body to oversee the regulatory regime, we remain firmly behind the best and most workable option — that is, to introduce mandatory professional membership for those working in tax advice.
Standing up for standards
Bringing unregulated tax agents into a proper framework would support the creation of a level playing field in the tax market, ensuring that everyone offering tax services is appropriately qualified. All the tax practitioners, in being regulated by a relevant professional body, will have to meet high standards in order to be able to practice. Not only will this establish minimum standards, but it will also deliver improved monitoring and effective enforcement resulting in better customer support. It is also worth noting that in a time where HMRC is under exceptional pressure to deliver its mandate with fewer resources, introducing better standards of tax compliance and advice through mandatory membership would inevitably ease the enforcement and compliance burden on the embattled HMRC.
“Compulsory membership does have the benefit of building on an existing model.”
Any significant regulatory reform has its costs, and while the consultation is limited in its assessment of those costs, when compared to the hybrid or government-led model, compulsory membership does have the benefit of building on an existing model. And while it would require a period of transition for the bodies to develop mechanisms to onboard those tax advisers that are currently unregulated — and time for those tax agents to demonstrate/attain the nec-essary standards of professionalism — the costs would be initially borne by the professional bodies.
Grasping the opportunity
After many years of campaigning on this issue, the opening of this consultation is a major win for our Accountable campaign. It marks what we hope is the beginning of a new era, and one that will ultimately see the introduction of compulsory professional membership. We are determined to continue to lead the effort to deliver that outcome, and we need our members to speak up.
Whether you’ve been faced with having to sort out issues new clients are encountering after receiving poor tax advice from their previous accountant, or are frustrated at the erosion of professional standards in your profession, this is the time to get involved. Those of you working on the front line know all about the harm caused by substandard or unscrupulous practitioners under the current framework. So speak up.
With all this in mind, the consultation is a welcome step in the right direction, and represents a golden opportunity not only to raise standards across the industry but also to make sure that AAT’s vision of a rigorous, dynamic and sustainable regime becomes a reality.
Reprieve over HMRC tax helplines cut
Pressure has told as HMRC, at least temporarily, pauses cutting its helplines
HMRC relents after pressure over tax helplines cuts
HMRC has paused plans to axe critical tax helplines after mounting pressure from AAT and others. In March, HMRC announced moves to shift its phone enquiry service to operating just six months of every year for taxpayers filing self-assessment returns. Outside of October-March, only online options would be available.
The agency similarly planned to pare back phone support for those paying VAT. HMRC’s VAT helpline service would only be open for five days ahead of the filing deadlines each month.
“We welcome HMRC suspending its controversial plans to axe critical phone support relied upon by millions of UK taxpayers,” said Adam Harper, AAT’s director of professional standards and policy. “Cuts to phone services would have been shocking to the majority of the public. Our members have been sharing their concerns about HMRC’s service levels for some time.”
Opinion on Accountable begins to coalesce
Support for Accountable is beginning to build among tax and accounting professional bodies. Industry title Accountancy Daily wrote that regulation of rogue tax advisers would not be a “silver bullet”, but noted broad support among fellow industry bodies, including ICAEW, ICAS and ACCA.
“We are one step closer to making all tax practitioners accountable, some of whom are currently operating outside enforceable professional standards,” Accountancy Daily quoted AAT chief executive Sarah Beale as saying.
Ellen Milner, CIOT’s director of public policy, said: “Regulation in itself is not a silver bullet to change behaviours or improve consumer protection. There are a lot of questions that need answering to ensure that any regulatory model is proportionate, outcomes-focused and workable.”
The battle is not yet won, however, so please do add your voice to help AAT make its case.
Botswana partnership to help young entrepreneurs
A partnership between AAT and Mebala Youth Studios in Botswana will help equip business owners in the country to navigate issues running their business. Speaking with YTV Botswana (youra.at/7k7ZAM), AAT CEO Sarah Beale explained the partnership, brought together by the British High Commission in Botswana, was the result of a “shared vision to equip young entrepreneurs with the skills they need for businesses thrive”.
“What we would like to do is to give financial skills and literacy to entrepreneurs at a different level.”
