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25 Apr 2007
A high-level meeting of the UK’s top tax professionals and the government met last Friday to thrash out the definition of an accountant, in a bid to make sure advisers are not hit with their clients’ tax bills.
The meeting was set up to begin discussions between government and tax advisers over incoming legislation to stamp out tax avoidance through the use of managed service companies.
Accountants are meant to be exempt from the possibility of facing their clients’ tax bills under the new law, yet there are concerns about the definition of an accountant and accountancy services, and which advisers are allowed the exemption.
The government has always been keen to avoid creating a strict definition for accountant, instead usually treating CCAB-qualifieds as accountants in legislation.
The CIoT’s Anne Redston, who attended the meeting, suggested there were many professional tax advisers who did not hold a CCAB qualification, including ex-tax inspectors. ‘We’re all hopeful of finding a definition not impossible, but difficult. I don’t think you need to be CCAB qualified as the legislation is not absolute on that.’
The issue of narrowing who can use the term accountant is regularly lobbied on by the accounting institutes, which argue unqualified members of the public cannot call themselves accountants.
ICAEW chief executive Michael Izza said on his blog last week that the unqualified debate was ‘a matter of public interest’.
Detailed consideration of the MSC legislation is expected in parliament over the next month.
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CCAB Institute's approach is "two-faced"
I have noted the CCAB institute's lobbying of government to get legislation so that only their members can be called accountants.
But I also note that these same institutes encourage their members in practice to call themselves "business advisors", despite the fact that few of them have any management or business advisory qualifications whatsoever.
A wrong set of accounts can skew the tax bill, but bad business advice can destroy a business - I rather think it is more important that the government legislates to only allow those qualified in management and business to be able to act as business advisors.
Perhaps the Chartered Management Institute should start lobbying to get government to protect businesses from CCAB accountants that give out unqualified business advice!
Posted by: Les Robinson MCMI CMA BA(Hons), 25 Apr 2007 | 00:00
Yes please! Define the term 'accountant'
I have long held the opinion that - just as with solicitors and doctors - the term accountant should be defined (and thus given some statutory protection).
My opinion is that anyone with a professional qualification (ie ACA, ACCA, CIMA) - and by virtue of that qualification subject to professional regulation, etc - should be able to call themselves an accountant.
And that those with AAT or similar should be defined as an accounting technician, and those who are not formally qualified should not be able to refer to themselves as an accountant or an accounting technician.
I think that the issue is complicated: the EEC money laundering directive essentially requires a definition. But also consumers are routinely mislead into thinking that anyone who calls themself an accountant is appropriately qualified.
Just try a straw poll and get 10 people off the street to select and differentiate between qualified and unqualified accountants from the Yellow Pages, for instance.
There are much wider issues than the competition/anti-competition debate that I am sure will be raised. After all, how many unqualified accountants follow practice assurance or have PI insurance or have an institute that people can complain to and have their complaints followed up? In other words, there is a complete absence of consumer protection!
Posted by: Jonathan Vowles, 25 Apr 2007 | 00:00
Not again!
Stating the obvious: taxation law makes individual taxpayers responsible for their own affairs and imposes a duty to supply certain information on-time and in due form.
You want the government to pass legislation which explicitly states that only certain persons (a tiny minority of all taxpayers) are competent to deal with statutory taxation matters.
So, all other taxpayers (the vast majority) gain an immediate defence against all but deliberate/fraudulent activity in regards to administering their tax affairs - in that the government has classed them as incompetent.
Due care and attention goes right out of the window.
The government, en masse, may be stupid but, probably, not that stupid!
Unless, the sting in the tail is to make any adviser liable for errors in any persons affairs in which (s)he is paid for advice.
QED the cycle is closed.
Posted by: David R. Aukett FCa Dip Coun, 26 Apr 2007 | 00:00