New legislation threatens tax advisers
Anti-money laundering legislation could threaten the future of the traditional tax investigation, the Chartered Institute of Taxation has warned.
The Proceeds of Crime Bill, which recently completed its Report stage in the House of Commons, will redefine money laundering and tax advisers’ liabilities.
But the institute this week told Accountancy Age that the government’s desire may severely damage the accountancy profession, as it would not be covered by the same legal privileges as solicitors on Inland Revenue investigations or tax disclosures.
It is intended to put tax advisers and accountants at the heart of the war against terror by making it law that they report their suspicions to the National Criminal Intelligence Service.
John Roberts, chairman of CIoT standards committee, said: ‘If the second directive of the Bill is adopted, what is to stop any well-informed client heading towards a solicitor for help. The solicitor will be covered by legal privilege and will not have to inform the NCIS. So why should the client prefer to consult a tax adviser without such privileges?’
If the second directive is adopted in its current form, commercial tie-ups between investigation practitioners and solicitors may become increasingly likely, the CIoT predicted. Accountants have also urged the Inland Revenue to extend the September self-assessment deadline following the closure of its online return site.
The Revenue has put the system back online after users reported being able to see other peoples returns towards the end of May.
But Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants, criticised the Revenue’s online track-record, adding: ‘The period for return on self assessment should be extended by a month beyond its deadline at the end of September to account for the downtime.’