AAT welcomes HMRC response on protecting customers tax repayments

The Association of Accounting Technicians (AAT) has “cautiously” welcomed HMRC’s response to its recent consultation on protection for customers claiming tax repayments.

According to the body, one third of the tax advice sector is unregulated, yet they cause two-thirds of complaints to HMRC, posing a “significant threat” to consumer protection.

While AAT has welcomed many of the proposals in the response, particularly around legislating to replace assignments with a nomination process, it has concerns around other suggestions which would “require significant resource and are overly complex, such as pre-contractual disclosure forms”.

Furthermore, AAT does not object to requiring agents to register with HMRC, it has concerns about HMRC’s capacity to police this.

AAT is calling on HMRC to build on the outcome of this consultation and include compulsory professional membership as a registration requirement for all tax advisers, not just repayment agents.

Adam Harper, director of professional standards and policy, said: “It’s good to see HMRC taking action against this unregulated sector, including the AAT recommendation to substitute outdated assignments with the nomination process.

“However, the added layers of complexity and additional resource around a register and pre-contractual disclosures will be difficult and costly for HMRC to oversee. If, instead, HMRC also required compulsory professional body membership, as AAT has called for in our Accountable campaign, it would give real teeth to the register as well as offer a much simpler and cost-effective solution.”