Taxpayer owes money? Prove it!

Far be it from me to pile on the agony, but the ways in which HMRC systems are deficient have not all been told yet. A new client is about 10 years behind with his tax returns, and bankruptcy proceedings are imminent. HMRC claim that a couple of tax returns were filed over that period, in 2000 and 2006, but the client says he did not file them.

I asked for copies, but HMRC haven’t supplied them. Do they exist? Can HMRC prove that my client filed those returns? Can they substantiate their claims in any way?

Not so far.

Why have they not retained proof of who submitted those returns? Can they prove that their records are right?

HMRC acting unlawfully

The Revenue has got a whole list of problems, some of which have been in the news a lot. For those of us on the front line of representing taxpayers, it doesn’t end there.

There are rules in place which say basically that, if the taxpayer doesn’t get particular pieces of paper or electronic returns in on time, he has to pay a penalty. Fair enough as far as it goes – incentives are needed. But what if the taxpayer did get the piece of paper in on time, but the Revenue didn’t record that fact properly, so they issue the penalty notice anyway? It happens – it happens every day.

When you’ve argued the point tooth and nail and they have finally accepted they did receive the piece of paper, do they cancel the penalty notice? No, they say they can’t, they can only reduce the penalty to nil.

Whoah, what a minute! We’re talking here about an illegal act by the Revenue. They have legal authority to issue a penalty notice when the piece of paper doesn’t arrive on time. They do NOT have legal authority to issue a penalty notice when the piece of paper did arrive on time, but they didn’t record that fact properly.

So the taxpayer is left with false information on his Revenue record. False information which the Revenue refuses to remove. And remember this happens thousands upon thousands of times.

Does this matter? Well yes, I think it does. If this particular Revenue record is unreliable, how many other of their records are also unreliable? In short, to what extent can we actually rely on what they say?

See the slippery slope?

Who should pay?

This is a theme I think I’ll be coming back to. Again and again.

Last week, if you needed an ambulance in Norwich / Norfolk, you might have had a problem. At one point, 40% of all the ambulances in the area were lined up outside Norfolk and Norwich Hospital. Whose fault was it?

Well, there are some candidates.

- if the hospital had been funded by a saner method than the PFI, there would have been money for more beds, doctors, nurses and so on

-  if the hospital trust had the power to charge the appropriate department (Social Services?) when a patient is ready for discharge but has nowhere to go, fewer beds would be blocked.

And so on. There are many permutations.

This is a big topic, and it will come up again. As will the name of Leslie Chapman.

The art of marketing

My leisure reading right now is a book I bought in the 70′s. Memoirs of a Station Master by Ernest Simmons. There is a section in it which, reading it now, puts me in mind of Hugh and Stormhoek wine.

The year is around 1861. The author is working on the Great Western Railway and meets the son of the couple who apparently owned Cock’s Sauce (made in Reading, and very popular in Victorian times.)

The man’s parents

“were butler and housekeeper to an old lady, who left them the receipt [recipe] when she died. The first sauce they made in a stew pan, but the most amusing part was how his father advertised it. There were no trains in those days, so he went up by road waggon to London and took some sauce with him. He used to call at the roadside inns, where the waggoners had their dinners, and give them all a drop, and then give what was left to the landlady. Catch a man doing that now. He puts a thundering great advertisement up with a painting of a sick lion in a net, or a likeness of the Queen to catch the eye, and then rides about first class, and does it all by correspondence.”

The waggon has become the internet and couriers, but the technique is surely not so different.

More bang for our buck

The generals have been commenting again on overstretch and underspending where it’s needed. Quite right too – it’s a big topic. But then the government says they have increased defence spending by so and so many billion.

Yes, but what are they spending the billions on? Eurofighters and aircraft carriers mostly, as far as I can see. All very fancy, but are they good value for money for Great Britain plc?

It seems they aren’t. All government ministers should be strapped to chairs until they have read “Lions Donkeys and Dinosaurs” by Lewis Page. It puts the case authoritatively and well.

It starts with controversy

This blog starts just as HMRC have lost some computer discs. Don’t worry – it’s only 25 million people who are affected. Nice timing – it’s a good example of one of the things I’ll be banging on about. More on this another time.

As an accountant, I’ve spent 30 years dealing with the Revenue and it used to be more straightforward. They were civil servants who saw their job as collecting the right amount of tax.  Not too little, not too much, but the right amount. The whole tax collection process is governed by a set of laws, so you know pretty much what the right amount of tax is.

Now? Well, now too often they don’t want the right amount, they want the maximum amount. I feel sometimes like I’m having to beat them back with a rolled-up newspaper. Poor Joe Soap taxpayer with no one representing him just pays up and doesn’t know any better. That’s not really how the Civil Service should be.

This blog is about themes. This is one of them.