As taxpayers, we might assume that all tax advisers are professionally qualified, belonging to a professional body – this is not always the case.
At the Budget in March the government announced a consultation into raising standards in the tax advice market. HMRC recognised that many tax advisers are technically competent and adhere to high professional standards, providing advice and support to taxpayers but HMRC are concerned that the tax advice market is not working as well as it should be, citing the loan charge as evidence of some of the perceived problems. In light of the pandemic, the closing date for submissions was extended to 28 August 2020 from 28 May.
The Chartered Institute Of Taxation responded to the consultation’s “call for evidence” and has since cautiously welcomed the government’s proposal that it would be a legal requirement for anyone wishing to give tax advice on a commercial basis to belong to a professional recognised body.
Richard Coombs, Tax Partner at Bates Weston, Chartered Tax Advisor and a member of the Chartered Institute of Taxation comments:
“The Government has recently published proposals that would require anyone providing tax advice commercially to belong to a professional body, such as the Chartered Institute Of Taxation (CIOT) or the Institute of Chartered Accountants in England and Wales (ICAEW). This is to address the apparent gulf in quality of advice and certain behaviours between those clients who are advised by a member of a professional body and those who aren’t. To many, the fact that providing tax advice is effectively unregulated is quite astonishing, especially given the complexity of the UK tax legislation and fact that invariably the numbers being dealt with are significant. Successive governments have gone to great lengths to regulate the financial services industry in order to protect individuals and therefore it seems an oversight that the tax profession has been largely unfettered by regulation.
At Bates Weston we would welcome such a proposal. As members of several professional organisations, including the CIOT and ICAEW, we see the value that such professional bodies bring. And as editors of the next edition of Tolley’s Tax Planning for Owner Managed Businesses” we are only too aware how complex and bewildering UK tax legislation can be.”
