By Amanda Vigar, Managing Partner, V&A Bell Brown LLP
One New Year’s resolution that many people set themselves is to get fitter.
But it is not just people who need to lick themselves into shape, there are organisations that need a major fitness wake-up call.
One outfit that desperately needs to shape up is HMRC. Alas, as it does not operate on a free market basis, its customers - aka the nation’s taxpayers who also pay to keep it running – can’t move to an alternative service provider no matter how bad its service is!
Service that, if replicated in the private sector, would see customers vote with their feet so HMRC would go out of business.
During the last few years, dealing with HMRC on behalf of my clients has become ever more painful. Not just atrocious levels of customer service but, even more worryingly, serious inaccuracies in its paperwork and online information. The Public Accounts Office has confirmed it is not just me feels this way!
HMRC has been labelled as no longer being fit for purpose. Businesses set themselves tough performance targets so it is appropriate that some are set for HMRC in 2016.
· Get your sums right
Almost daily I see clients getting blatantly and obviously wrong tax demands.
This includes one client whom we know had already paid everything due to HMRC. So, imagine their horror when they were told they were more than £1,700 in arrears.
When challenged, and having admitted the mistake, even more horrifying an HMRC employee admitted “this happens all the time”. I hope the call was being recorded!
· Pay tax refunds quickly and efficiently
It often takes an inordinate amount of time for monies to be repaid by HMRC – our record is a client being given a rebate payment date that was more than three years from when it was brought to HMRC’s notice. Strangely, when you owe them……
Often the amount involved means such a delay could push some small employers over the financial brink.
· Be consistent
We often find that correspondence from HMRC includes totally different figures to those that appear on its online systems – when they do appear that is.
Giving taxpayers and their agents access to reliable, and consistent, information would greatly lighten HMRC’s workload. If they got it right they could save massive amounts of time (and taxpayers’ money) not having to deal with queries about their internal discrepancies.
· Improve the HMRC telephone service – or offer a callback service
Research published last month by Which? revealed callers are, on average, held in phone queues for 38 minutes before speaking to an advisor. With HMRC using 0300 numbers a taxpayer could be paying up to 45 pence a minute, depending on their type of phone, so that wait could cost a massive £17
I do wonder how many people give up long before that sort of time has elapsed.
Don’t just go for easy (but meaningless) targets
About 25 percent of tax prosecutions last year involved less than £10,000 of revenues, according to the National Audit Office, not exactly the high-value, high profile ones that you’d expect – but it’s easier to hit a volume target.
Indeed, the NAO raised concerns about HMRC focusing on easier prosecutions to hit the annual target of bringing 1,000 cases against tax cheats. The cost of this is disproportionate to the amount being claimed, especially as the recovery rate is appallingly low. HMRC should focus on the total amount of tax being recovered rather than the number of cases.
So, SHAPE UP HMRC!
Unless HMRC adopts my New Year Resolutions and puts its house in order, I dread to think of the future - especially as in the next decade 170 regional tax offices are likely to close and be replaced with 13 larger hubs in a bid to shift more customers to online tax services. My heart sinks even further!