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ATT concerned that public not adequately protected

17 January, 2023

The Association of Taxation Technicians (ATT) has welcomed plans by HM Revenue & Customs (HMRC) to strengthen their ‘Standard for Agents’ 1 but questioned whether this is enough to protect the public from tax agents who are not members of professional bodies, and therefore not subject to the even stricter professional standards of those who are. 

HMRC have bolstered their ‘Standard for Agents’ setting out what expectations it has of tax agents in their dealings with HMRC. The Standard, which applies to all tax agents, is being updated following a consultation on improving standards in the repayment agent sector2 and will include:

  • a requirement for greater evidence of customer consent, to ensure taxpayers better understand the agreement they are entering into;

  • stricter transparency rules, including introducing a 14-day ‘cooling off’ period for customers after entering into an arrangement with an agent, and an obligation on agents to ensure all communications and advertising material are fair, clear, accurate and do not mislead or conceal material facts.

Whilst these measures go a step closer to regulating tax agents3, the Standard still does not require agents to have Public Indemnity Insurance (PII)4 or participate in Continuing Professional Development (CPD)5, both of which are required by members of professional bodies under the stricter, more rigorous guidance contained within the Professional Conduct in Relation to Tax6.

Senga Prior, Chair of the ATT Technical Steering Group, said:

“A common misconception amongst the public is that the provision of tax services is a regulated activity akin to other professional services such as most legal and financial services, but this is not the case.

“As long as activities relating to taxation can be undertaken by anyone who chooses to do so and can be undertaken without any kind of effective regulation, there will always be the opportunity for some engaged in those activities to do so with scant regard for customer protection.

“Strengthening the Standard for Agents will go some way towards demonstrating to the public the professional and behavioural characteristics HMRC expect agents to adhere to, but for this Standard to be effective, HMRC need the legislative power to enforce any non-compliance.

“More work is therefore needed in this area to increase public confidence. We look forward to the promised publication of HMRC’s fuller consultation with stakeholders, on options to improve the wider regulatory framework that supports standards in tax advice, in a way that fulfils the three criteria of clarity, transparency and enforcement.”7

Notes for editors

  1. HMRC’s Standard for Agents can be found here. It sets HMRC’s minimum requirements for tax advisers and tax agents. All agents must comply with these requirements, but agents or advisers who are members of a professional body must also comply with their own, stricter professional standards.
  2. HMRC’s consultation on Raising standards in tax advice: protecting customers claiming tax repayments and the summary of responses can be found here.
  3. The ATT response to the consultation document can be found here.
  4. Professional indemnity insurance (PII) protects against claims for loss or damage made by clients or third parties as a result of the impact of negligent services provided or negligent advice provided, PII is required by all self-employed members of the ATT.
  5. Continuing Professional Development is the mandatory requirement to maintain and develop skills and competencies necessary to carry out professional and technical duties competently throughout the member’s working life.
  6. Information on the Professional Conduct in Relation to Tax can be found here.
  7. Contained within the Foreword by the Financial Secretary to the Treasury to HMRC’s Summary of responses and next steps (30 November 2021) which can be found here.