HMRC’s failure to consult public on Making Tax Digital is “plainly just wrong”

A leading London accountant has said HMRC’s repeated broken promises to seek public consultation on its revolutionary plans for Making Tax Digital, are “plainly just wrong.”

The development of HMRC’s Making Tax Digital software appears to be at an advanced stage, despite the fact that the project’s latest four consultation documents – including details on the mechanics of quarterly reporting for companies – have yet to be published.

This major overhaul of the tax system, which will see all taxpayers given online accounts detailing their tax status and liabilities, is set to commence from April 2017 for businesses and April 2018 for individuals.

However, HMRC has yet to set a date for the publication of the consultation document, although it continues to insist it will be issued ‘shortly’ despite its tight timetable for implementation, development and the current parliamentary summer recess.

Tim Cook, a Tax partner with London-based Wilder Coe Ltd Chartered Accountants, said: “The continued failure of HMRC to enter into any form of dialogue with the outside world on what is clearly going to be something of a revolution in the tax system is plainly just wrong.

“They are succeeding in alienating the agent community and the taxpaying public at large by not engaging.

“HMRC likes to tell everyone that they are working collaboratively – clearly they are not.

“It is also clear from HMRC’s plans that they are attempting to cut out agents and accountants in future compliance matters. This is wholly unreasonable.

What has happened to the famous edict from The Duke of Westminster tax case by Lord Tomlin:

“Every man is entitled if he can to order his affairs so that the tax attaching under the appropriate Acts is less than it otherwise would be. If he succeeds in ordering them so as to secure this result, then, however unappreciative the Commissioners of Inland Revenue or his fellow tax-payers may be of his ingenuity, he cannot be compelled to pay an increased tax.”

“If taxpayers are going to be denied access to advice and counsel where does this leave us?”

His comments come in the same week that HMRC’s Chief Digital Officer, Mark Dearnley, who has been spearheading the Making Tax Digital initiative, has revealed he will be leaving the tax authority next month once his existing contract expires.

Tim added: “Furthermore, with this week’s resignation announcement of HMRC’s chief digital officer, is this whole matter heading for a disaster?”

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