Taxman sets 'hit squad' on big business

The government has assembled a ‘hit squad’ to tackle large business tax
risks, a senior official said this week, as companies were warned to adopt a
constructive attitude towards new tax relationship managers or risk
investigation.

In an interview with Accountancy Age, David Garlick, the head of HM
Revenue & Customs’ Large Business Service, said a new group of officials
would tackle big businesses’ attempts to reduce their tax bills.

The squad, known as the strategic response unit, has hired around 25
‘external experts, some from the Big Four and some from large corporates’,
Garlick said.

The unit will assess the potential impact of new threats to tax revenues to
ascertain whether specific tax avoidance measures were likely to have widespread
take-up.

Large companies are also being warned to talk to HMRC or face an increased
burden of investigation.

The government has put in place new dedicated relationship managers for big
businesses, who are currently making contact with the companies they have been
assigned to.

‘Some are saying, “Let’s meet every fortnight.” Some, “I don’t want to see
you.” If they don’t want that relationship, it changes the behaviour score,’
Garlick said.

Companies are scored according to the compliance risks they represent, as
well as the relative aggression of their tax policies, and resources directed at
those who most threaten tax revenues, in the first joint Revenue and Customs
approach to resource allocation for big business.

‘The ethos of this model is “I shift the resource,”‘ Garlick said. The move
suggests that big corporates could find themselves under investigation if they
do not establish a positive working relationship with their managers.

Though the officers have investigation powers, advisers have suggested the
relationships exist outside the legal framework.

One Big Four firm said some groups ‘will have taken legal advice’ about the
managers.