HMRC has published the result for recent research, ‘Understanding the characteristics of unaffiliated tax agents’. It explores the characteristics of unaffiliated tax agents, those agents who are not members of a professional body. It seems that these agents fall into four different typologies.

The survey of 301 unaffiliated agents profiled their characteristics, follow up qualitative interviews with 35 unaffiliated agents explored behaviours, attitudes and perceptions in more depth.

  • Broadly, the unaffiliated agent population tended to be older, 69% were aged 55 or over, and highly experienced, 64% had at least 21 years of experience in the industry.
  • In terms of business model, 70% of unaffiliated agents worked as a sole trader. Only 5% of agents had an employee.
  • An equal proportion of unaffiliated agents said they were a bookkeeper (41%) or an accountant (41%).
  • 18% had a professional qualification and 29% had no qualifications.
  • 40% of agents worked in the construction sector, 20% mainly worked with clients in the wholesale or retail sector, and 16% said their clients’ sector varied too much to say.

Different typologies of unaffiliated agents emerged from the data:

  • (Close to) retirees: were older and close to retirement; they tended to be very experienced, and mostly highly qualified.
  • Ambitious expansionists: tended to be younger and were keen to expand their business or progress their career, if not immediately, at some point in the future.
  • Confident by-proxy: did straightforward, repetitive work and were mostly bookkeepers; they were confident in the quality of their work, but as it was checked most of the time, did not necessarily feel fully accountable.
  • Practice makes perfects: had learnt on the job, predominantly gaining their knowledge through practice and experience; they saw little need for formal upskilling.

Only 42% of the sample carries Professional Indemnity Insurance (PII).

The Report concludes:

  • Relatively few unaffiliated agents said they followed formal standards set by either professional bodies or HMRC, they thought that compliant behaviours were demonstrated through accuracy, following guidelines, and following legislation.
  • The standard they worked to did bare some consistency with the PCRT and/or HMRC’s standard.
  • Agents were unaffiliated because they either saw no benefit in membership of a professional body, elder agents saw age or retirement as a barrier to membership, not having, or being unwilling, to get the required qualifications, was also a relatively frequently mentioned reason for non-membership.
  • These agents see PII as an unjustified cost and unimportant for the type of work that they undertake, thinking that they would come to an amicable resolution if a client sought compensation due to poor service.

External link

HMRC survey: Understanding the characteristics of unaffiliated tax agents


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