AAT notes missed opportunity to raise tax advice standards on Tax Administration and Maintenance Day

AAT has reinforced its call for the government to introduce mandatory membership of a relevant professional body for anyone offering paid-for tax advice, following the government announcements made as part of its Tax Administration and Maintenance Day today.

Tax Administration and Maintenance Day sets out further details of tax administration and maintenance measures announced as part of the Spring Budget. It focuses on three key areas: simplification and modernisation of the tax system, tackling the tax gap, and further tax policy and administration announcements.

Responding to the announcement, Adam Harper, Director of Professional Standards and Policy, AAT, said: "AAT welcomes the renewed focus on simplification and closing the tax gap, and we will be looking to work constructively with HMRC and our members as these policies develop. However, whilst we take time to review the government's announcements in more detail we already know that more than £9 billion of the tax gap is comprised of taxpayer error or failure to take reasonable care. If the government wants to make a serious impact on this part of the tax gap, it must explore policies which raise standards in the accountancy profession. That's why today we are reinforcing our call for the government to introduce mandatory membership of a relevant professional body for anyone offering paid-for tax advice – something which AAT has long campaigned for through our ongoing Accountable campaign.

"Research we published earlier this month shows that four in ten businesses have lost money due to poor accounting and, at a time where many businesses are already facing challenges, today's announcements mean that taking a risk on an unregulated accountant or tax advisor could be make or break. Compulsory membership of a professional body would ensure that any paid-for tax advisor or accountant is appropriately qualified with robust oversight and greater consumer protection. In the meantime, we encourage individuals and businesses to ensure their accountants and tax agents are members of a professional body with strong codes of ethics and practices."

There are a number of key measures in the statement which are of particular relevance to AAT and its members.

• Tackling promoters of tax avoidance: A consultation on introducing a new criminal offence for promoters of tax avoidance and expediting the disqualification of directors of companies involved in promoting tax avoidance.
• Repayment agents: As announced earlier, the government will require repayment agents to register with HMRC to protect vulnerable customers, within a three-month window starting on 2 May 2023 .
• Construction Industry Scheme (CIS) reform: A consultation looking at several reforms to the CIS, such as strengthening the tests for Gross Payment Status (GPS), principally by including VAT in the compliance test when considering qualification and retention of GPS. It will also explore proposals to reduce administrative burdens of the scheme.
• Tackling non-compliance in the umbrella company market: The government will publish a summary of responses to the 2021 call for evidence on the umbrella company market, accompanied by a consultation on policy options to regulate umbrella companies and tackle non-compliance in the umbrella company market.

AAT will review today's announcements and respond to relevant consultations in due course. The full details of all publications and announcements from Tax Administration and Maintenance Day are on GOV.UK.

For more information on AAT's Accountable campaign, including advice on how to find a regulated accountant or tax advisor, visit AAT Comment.