TaxPersonal Tax‘Enabling letters’ row erupts

'Enabling letters' row erupts

The Inland Revenue is threatening long-standing relationships between accountants and tax inspectors because of ill-expressed 'enabling letters' sent out to taxpayers.

Link: Self assessment ‘failures’ inquiry underway

High street accountants say that they are increasingly concerned over letters sent out to self-assessment taxpayers ‘casting doubt’ on their 2003 tax returns.

But the letters haven’t just been causing problems for accountants and their clients. Tax inspectors are also experiencing difficulties in their relations with accountants.

The so-called ‘enabling letters’ have been sent out to certain taxpayers with a separate copy to their accountants ‘suggesting that the accounts and return that we prepared are wrong,’ said Roger Griffiths of Plymouth-based Metherell Gard chartered accountants.

Griffiths said: ‘What they’re doing isn’t clear. They are writing directly to taxpayers leading them to believe that something is wrong.’

The chartered accountant said he phoned his local inspector of taxes to voice his concerns, but the inspector said he wasn’t happy with the situation either, complaining that the enabling letters are upsetting the good relations he has spent years building with local accountants.

John Whiting, tax partner at PricewaterhouseCoopers, said: ‘From the Revenue’s point of view it might be with the best intentions to point out common errors.

‘But clearly it’s being seen as implied criticism of tax advisers. That’s a shame, as it sounds like a good idea but the language might be misleading.’

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