MPs from the Treasury Select Committee have called for a review of HMRC's powers, deterrents and safeguards following considering the proposals in the 2014 budget which include retrospective taxation and direct access to taxpayer's bank accounts.

In reporting on the 2014 Budget the Committee says:

"Following the merger of HM Customs and Excise and the Inland Revenue in April 2005, an extensive review of HMRC’s powers, deterrents and safeguards was carried out from 2005 to 2012. The Committee believes that sufficient time has now passed to warrant a post - implementation review of these powers. The aim of this review should be to ensure that all the powers HMRC has at its disposal remain relevant and are no more than are sufficient to enable HMRC to achieve its objectives."


If only MPs would look closer at the 2014 Finance Biill, they will note a new penalty regime for share schemes too. That's hardly the simplication envisaged by the Office of Tax Simplification in its review of shares schemes.
The broader question is what our regime of excessive penalties and powers has created. Anyone arriving in the UK to start a business right now might think that HMRC's policy, through the use of penalties to extract the largest possible amount from UK businesses and taxpayers. It appears to be designed to increase revenue and act as a punative tool that can drive some businesses into the ground.
From October 2014 those unlucky enough to be employers face a new monthly RTI penalty regime, this comes on top of the late payment PAYE penalty regime and the other regimes which include:
  • CIS (monthly)
  • VAT (quarterly)
  • Corporation tax
  • Share schemes
  • Self Assessment and
  • not also forgetting the spectre of late filing penalities from Companies House for companies.
 What do you think:
  • have HMRC's powers and penalty regime created an unbearable administrative burden on SMEs or
  • are they acceptable and propoprtionate?

Email us - we are keen to canvas your views