The Institute of Chartered Accountants of Scotland (ICAS) has expressed its opinion on the recent UK’s HMRC consultation, seeking to enhance powers over tax advisers.
The consultation, which concluded at the end of March, proposed measures to investigate and penalise tax advisers suspected of contributing to inaccuracies and the tax gap.
ICAS has submitted a comprehensive response to the HMRC consultation on additional powers, including a call for mandatory qualifications for tax advisers.
The consultation, which aims to bolster HMRC’s authority in investigating and penalising tax advisers, has sparked a debate on the integrity and competence within the profession.
ICAS emphasises the majority of tax advisers are “competent” and uphold professional standards, contributing positively to the tax system.
Despite a lack of evidence indicating widespread incompetence among ICAS-licensed practitioners, ICAS acknowledges the existence of a minority who negatively impact the industry and supports targeted action against such advisers.
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By GlobalDataICAS expressed disappointment at the lack of progress towards the mandatory professional membership for tax advisers, a move they believe would mitigate many issues plaguing the tax advice market.
This stance follows majority support for the proposal during the 2024 consultation on the potential regulation of tax advisers, yet no indication of its implementation has been provided.
The institute agrees with the consultation’s principle that tax advisers should be able to assist clients with compliance challenges and that mistakes should not preclude advisers from obtaining insurance.
ICAS calls for any new powers to be precise, proportionate, and safeguarded to avoid unintended consequences for professionals who maintain high standards.
It suggests that the proposals for enhanced investigative powers and penalties require substantial revisions to avoid negative repercussions on competent advisers who may make inadvertent errors.
Besides, theaccountancybody seeks clarity on the proposal to publish details of sanctioned tax advisers, advocating for a balanced approach.
Lastly, ICAS is generally supportive of increased disclosures to professional bodies about concerns regarding tax advisers, provided that appropriate reporting thresholds are established
