FIRMS HAVE WELCOMED the Revenue’s extension of its “remarkably successful” alternative dispute resolution (ADR) service, which has seen it introduced nationwide.
The service is designed to find a swift and fair outcome to disputes in order to mitigate costs and eliminate the need for a tribunal.
It works by using independent HMRC facilitators to resolve disputes between the taxman and customers during a compliance check before a decision or assessment has been made.
The facilitators are HMRC members of staff who have been trained in ADR techniques and have not been involved in the dispute.
That was a source of concern for John Cassidy, tax investigations and resolutions partner at PKF, who in January expressed concern about the potential for bias among HMRC’s mediators. However, having seen the pilot in action, his worries have been allayed.
He said: “We’ve seen from the pilot that HMRC’s facilitators have remained impartial, so praise where praise is due.
“Eventually, external, independent mediators should be rolled out.”
With approximately 20,000 disputes yet to be heard by tribunals, Geoff Lloyd, director in Ernst & Young’s tax controversy team, was pleased with the introduction of the settlements, but added that the process needs augmenting, and could be used for larger firms and more complex cases.
Lloyd said: “ADR has been remarkably successful in resolving tax disputes of all shapes and sizes, avoiding the costs and delays to both sides of going to court.
“There’s a need for a lot more ADR than we’ve seen to date and opening up the process to individuals and SMEs throughout the UK is a positive development. There’s more to be done, too, for large and complex cases.”
The process was piloted in the northwest, the southwest, Wales and London from January 2012.
CIot urges HMRC to consider a delay to the 1 September 2017 introduction of its new corporate offence of failure to prevent the criminal facilitation of tax evasion
HMRC intends to extend the date for withdrawal of transitional relief on investment growth from 30 November 2016 to 31 March 2017
The current business rates system is over-complex and reform is needed, but reforms should focus first of all on simplifying the appeals process, particularly for businesses which are subject to business rates exemption
The CIoT has called on the government to rethink its approach to ensuring online sellers pay the correct amount of VAT.