ICAEW: No disciplinaries yet against tax avoidance advisers

THE ICAEW has yet to discipline any members for advising clients on aggressive tax avoidance schemes, despite setting a strong stance against such behaviour three years ago, the institute has confirmed to Accountancy Age.

In 2012, the ICAEW announced members advising on schemes that could be interpreted as aggressive could be held to be bringing the profession into disrepute.

The institute’s helpsheet which accompanied the announcement set out the hallmarks of avoidance schemes to consider for ICAEW members and warned that contrived tax planning is potentially against its code of ethics, despite earlier concerns from practitioners that they could be held negligent if they fail to draw clients’ attention to all available options.

And while the institute is “currently looking at a few cases with regard to tax advice”, none have yet resulted in disciplinary proceedings being brought against a member.

The institute can only investigate members if a complaint is made, for example from HMRC, or there is sufficient evidence in the public domain to justify an investigation.

But to date, HMRC has passed the ICAEW “little information that we have been able to act on”, an institute spokeswoman said in a statement to Accountancy Age.

She added it is “in dialogue with HMRC to ensure that, as a regulator, we are made aware of cases where the behaviour of our members when it comes to tax advice is not of the highest professional and ethical standards and they believe there is a case to answer”.

The news comes as pressure mounts for greater regulation of tax advisers to be brought in, with the Treasury publishing a document this month “asking the regulatory bodies who police professional standards to take on a greater lead and responsibility in setting and enforcing clear professional standards around the facilitation and promotion of avoidance”.

The question of a new code of conduct was raised in February by the Public Accounts Committee, which accused PwC and other large accountancy firms of helping multinational companies to drive down their tax bills to negligible levels by funnelling their UK profits through low-tax jurisdictions offshore.

The committee this week noted its “disappointment” in HMRC after it rejected the need for a tougher code of conduct for tax advisers.

HMRC’s position is “out of kilter with its wider policy to clamp down on aggressive tax avoidance,” the committee said.

Accountancy Age has requested comment from HMRC.