Sarah has been with Claritas for a few weeks now, so we thought it was time for us to understand more about her role, and what a Tax Dispute Resolution Specialist actually does…
Tax Dispute Resolution (TDR) is a specialist service providing strategic advice and day to day management of any form of tax dispute.
As TDR specialists, we know what information HMRC can and cannot request. When providing information to HMRC on behalf of the taxpayer we can anticipate what HMRC will do with that information and can therefore pre-empt any further questions increasing the likelihood of a swift resolution and ensuring that there are no unnecessary costs for dealing with the enquiry.
Several years ago, I was engaged by a new client to make a disclosure of tax fraud to HMRC for a seven-year period. In the first year of the period in question, no income had been declared to HMRC. In subsequent years half of the income was declared and half was left undeclared in an offshore account. The loss of tax to HMRC was greater in year one than in each subsequent year but what mattered was the behaviour of the individual at the time the irregularities arose.
By fully exploring how the client’s work opportunity came about, how it worked in practice and what advice my client received from third parties, I concluded that my client had been no more than careless in year 1 and I communicated this effectively to the Inspector. This meant that the first year’s fee income was out of time to be assessed by HMRC, saving circa £170k in taxes, interest and penalties.
The key learning points here are that it is essential to meet a client for a full fact-finding discussion at the outset of an engagement and, I suggest, to have regular discussions thereafter. Taking the time to do so allowed me to identify the subtle differences between the arrangements in year one and the arrangements in later years resulting in a huge saving for the client and most importantly securing the right result.
Should HMRC open an enquiry into the tax position of one of our own clients, the advantage of having an in-house tax dispute resolution team is that the tax dispute resolution expertise is readily available, of a high standard, and the TDR team can collaborate with the relevant day to day client service team reducing any need for the client to identify and engage a new adviser and for the existing adviser to get to know a new adviser.
In an alternative scenario, where no action has been taken by HMRC, but it comes to light that the client has a tax irregularity to disclose, the client will have immediate access to a confidential discussion about the best way to correct the tax position and we would use our understanding of the HMRC structure, its processes and our established relationships within HMRC to recommend the best approach.
Outside of work I enjoy a daily yoga practice to unwind and gather my thoughts. At the weekend, the time has now come when my husband and I allow our five-year-old daughter to stay up later than our one-year-old son and so the three of us have a film night on Friday evenings and a couple of hours together playing board games on a Saturday night.
Sometimes this takes place at my parents’ house because, as one of five siblings, there is often one celebration or another that takes us to the West Midlands to visit family.
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22 November 2023
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