HMRC to withdraw agents’ copies of forms

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HMRC to withdraw agents’ copies of forms

by Tax Faculty Team on 07.09.2010 11:37 24 comments 4580 views
Topics: PAYE and employers, Personal tax, General

In a cost-cutting move, agents will no longer get copies of some PAYE and SA forms

HMRC announced last week that it is going to withdraw the agents’ copies of some self assessment and PAYE forms.

The forms affected are:

P2 – PAYE coding notice

P800 – Tax calculation

SA250 – Letter with UTR and requirement to do an SA tax return

SA251 – Letter to someone coming out of SA

In addition HMRC is reviewing the P810 (the targeted review form), which is not copied to agents, and the SA252 (letter to taxpayers not in SA but liable to higher rate tax).

Full details of the changes are in an HMRC briefing note dated 3 September 2010 which was sent to representative bodies including the Tax Faculty. HMRC will be publishing a message on its website very soon.

In addition to the withdrawal of the forms, there is further news in the briefing note. HMRC says:

“We will also be introducing system enhancements from December 2010 to delay the issue of P2s to SA customers until all 2010 SA Returns (for those meeting the 31/1/2011 online filing deadline) are captured. This means that the code we issue will be based on the information in the return and will avoid the need for amendments had we issued the code earlier. This change was originally proposed by agents in a National Working Together sub-group and should, we think, be very welcome.

“We think that agents will also be pleased to know that recent changes to our National Insurance and PAYE Service (NPS) system mean that multiple forms P161 should no longer be issued every time a new source of occupational pension is notified to us.”

The forms are being withdrawn to save costs (and as we know, HMRC is finding itself increasingly squeezed on resources). This is part of a wider review of forms to see if HMRC can reduce the number sent out, improve current forms, and replace or remove some of them.

HMRC says: “We are sorry if some of these changes are unwelcome but we have tried to look for savings in those areas where there will be minimal impact on our customers.”

The Tax Faculty was not consulted about this beforehand and we know that some members will be concerned at the loss of these copy forms. Let us know what you think – please post your comments below, or email them to Philippa.Stedman@icaew.com.

Update: In the above item we said that HMRC would be posting the news about withdrawal of agent copy forms on its website. This has now been done and is covered in our 14 September news item Forms which HMRC sends to agents.

Comments

# | by dje on 07 September 2010, 17:10

Don't think anyone would have a problem if forms were sent electronically or available from HMRC agent portal, but to stop them completely could cause problems.

As we all know, clients don't always send the forms they receive on to us for various reasons, not least because they think we always get a copy of everything from HMRC.

Improve the online.hmrc.gov.uk website for agents and we won't object to less paper though the door.

# | by Liz Whiteley on 07 September 2010, 17:12

Notices of coding: given the fiasco over notices of coding both now and earlier in the tax year, it is crucial that agents continue to receive information on coding. Unless and until HMRC make this information available online to agents, paper copies are essential. Otherwise HMRC will have to provide this information by telephone; surely the time costs of this for HMRC will far outstrip any savings on sending out paper copies.

Please, ICAEW, make urgent representations about this.

Liz Whiteley

# | by Melanie Sharkey on 07 September 2010, 17:12

They must publicise this because this is a substantial change to practice and most clients assume that we get copies of these documents.This is particularly relevant to assessments that result in refunds where we always ask our clients to check whether they have actually received their refund.Perhaps on the documents they only send to the client they should remind them that they need to refer to their advisor if they have one if they need clarification.

# | by Christopher Reed on 07 September 2010, 17:25

I seem to remember that the ICAEW fought hard some years ago to persuade the Inland Revenue to send copies of P2 coding notices to agents so it's disappointing that HMRC are now turning back the clock.

As dje says above, clients often think we get copies of everything they receive from HMRC and they are even less likely to appreciate that we're not getting those that they know we received.

Lastly, I've seen many instances of the SA251 letter being issued inappropriately and on phoning HMRC they have reinstated SA and sent out the SA250 letter. I fear that we will now see taxpayers being taken out of SA when they shouldn't be.

# | by Angela Williams on 07 September 2010, 17:33

I do understand the need for economy but I entirely agree with others comments above. Not receivinig copies of these forms will be inconvenient and could lead to errors in clients' tax affairs. I often find clients have been removed from SA when they should not have been and the agent may not now find this out until a (now unsolicited) return is submitted. We do at the very least need:

1. Email notification that the forms/letters have been issued so we have the opportunity to ask clients to send us copies to review; and

2. The forms to show prominently that agents have not been sent a copy.

Ideally it would be useful to view a copy of P2 online like we can view statements.

I know some agents do not generally review P2s - would it be possible for those that do to opt back in, saving HMRC at least some costs.

However there is good news: delaying P2s for SA filers until after 31 January filing will save HMRC, agents and taxpayers unnecessary costs.

# | by Roderick Wright on 07 September 2010, 18:03

I agree completely with Liz Whiteley; part of the PAYE overpayment fiasco is surely down to the iniquitous Revenue practice of sneaking in large adjustments for investment income onto the notice of coding. If we do not see these notices....and when the actual Investment income is far less than the gross estimate, bingo, another overpayment.

No wonder they wish to cease sending these forms to us!!

# | by Barbara Whale on 07 September 2010, 18:11

Unfortunately the demise of the paper copy of documents pushes work onto the accountant. If the online notifications are like the PAYE ones - we receive a notification to find nothing is there so we log out and in again just to make sure - it is a time consuming and costly exercise that we cannot bill to any one. When fast broadband reaches the rural community we operate from (being literally at the end of an overhead telephone line, our broadband is not much better than dial up) then I may gladly accept no paper but not at the moment.

# | by Simon Paskin on 07 September 2010, 18:34

Not the smartest move HMRC are going to take if they will no longer provide us with copies of P2s.

I have noticed, however, that Agents' copies are not in fact strict copies of the P2s given to taxpayers.

The taxpayers' copies state what the new code is and the code it is replacing. We don't get that.

It also appears to me that the taxpayers HMRC always want to remove from SA are those who claim refunds. If they sent out R40s instead I could accept their point of view ... but they don't.

# | by T Evans on 08 September 2010, 01:17

HMRC must NOT withdraw the SA tax calculation from agents. We are constantly correcting errors - unless they propose to make these accessible online this will create a huge administrative burden and create further confusion (already considerable). The tax calculation is the only record we have of what has been recorded following a return - our clients expect us to know what has been sent to them - please do not withdraw this facility. I for one, have had enough of the centralisation of tax matters to call centres with no expertise.

# | by Brenda Vowels on 08 September 2010, 08:58

This is a disaster and I fully agree with Liz Whiteley. Please make urgent representations about this.

Presumably this is being done because we agents have spotted too many errors. I note in the Daily Telegragh today (08/09/10) 'one in five notices of coding are incorrect' . Only one in five? I started keeping a records in January 10 and found 24 out of 25 were wrong, then I gave up.

Brenda Vowels

# | by Darren Bailey on 08 September 2010, 09:13

The general consensus so far appears to be a very strong feeling that the agents should get a copy (either paper or electronic) of the notice of coding. I would welcome the Institute making representations to reflect this feeling. If we want to be more efficient then information of the SA website could be improved to provide copies of any forms sent to the client. Telephoning to clarify the breakdown of what is included in a coding notice is inefficient for the Revenue and even more so for the agent.

# | by Sarmad Khan on 08 September 2010, 09:33

Agents should get a copy. Some of the clients, don't understand letters from HMRC, and forget to bring them into the notice of the agent.

I would like that ICAEW approaches HMRC for this. The future is going online, may be the agents can get a PDF copy by email?

# | by Christopher Reed on 08 September 2010, 10:35

To reassure T Evans, I believe it's only the agent's copy of the P800 tax calculation which will be withdrawn and the SA302 version will continue to be copied to agents. I really hope that's right!

# | by Michael Trigg on 08 September 2010, 10:46

With the current fiasco relating to the PAYE system, the withdrawal of any communications from HMRC is a retrograde step. It is obvious from News reports that a vast number of taxpayers do not understand the tax system and believe that HMRC always gets it right!!

The HMRC belief that taxpayers know the tax system is a fallacy. taxpayers do not understand teh importance of letters from HMRC and HMRC often makes incorrect decisions.

Please lobby for the reinstatement of these notices, even if it is by electronic means.

# | by Colin Smith on 08 September 2010, 12:22

Where a client has multiple annuities from one provider, it would be helpful if the reference numbers were quoted on the coding notice so that the different codings apparently issued to one provider would not appear to be contradictory duplicates. And yes we do need copies sent to us.

Colin Smith

# | by Tax Faculty Team on 08 September 2010, 13:01

Thank you to everyone who has posted comments so far - do keep them coming. The Tax Faculty is keeping a close eye on the responses to this news item and our members' views are crucial in informing what we say to HMRC.

# | by nick goddard on 08 September 2010, 13:24

Obviously their systems are not sufficiently developed for them to replicate the process used for PAYE, which seems to work quite well.

# | by Simon Paskin on 08 September 2010, 13:37

Yes, Colin Smith, a very good point well made.

Some clients have more than one pension policy with say Prudential and each policy has its own tax code.

Unfortunately, the P2s state that Prudential South (in this example) will be notified of the new code ... but to which policy does it relate as the tax reference numbers are the same, as Colin has pointed out?

It becomes guesswork on our part and presumably the same applies to the pension provider. What a great way to run a tax system ... by sheer guesswork.

# | by Lesley Tooley on 09 September 2010, 08:36

Having read all the comments can I add my voice to the call for these documents to continue to be copied to agents and for the ICAEW tax faculty to lobby hard for this. It is about time that HMRC recognised the amount of work we do in ironing out their mistakes; the current furore about tax underpaid by taxpayers would have been worse without our input. How can we help our clients pay "the right amount of tax" if we are working in the dark?

# | by Rosemary Springfield on 09 September 2010, 11:18

Despite requesting twice in writing copy Paye codings these were not received from the Revenue for a client who was the subject of an enquiry against his 2006/07 Tax Return. His coding for 2008/09 was automatically adjusted to a penal higher rate tax deduction at the start of the enquiry, which I was given to understand was normal practice. The enquiry finished in July 2008 with no additional tax payable. It was only in September when my client complained about the current high rate of tax he was paying that I contacted the Revenue. The East Kilbride compliance team had failed to notify the closure of the enquiry to the main Surrey and N Hampshire district so the penal coding had continued which resulted in large repayment of tax in the month the correct code was applied.

With the withdrawal of copy Paye codings to agents can the Revenue confirm that their procedures will be tightened so that this situation cannot recur.

# | by Jennifer Nicolson on 09 September 2010, 12:11

Is this just an attempt by HMRC to cover up the fact that the majority of coding notices are incorrect. Having spent the last few years telling clients that we do not need to see coding notices as we get copies (well usually), we have now got to spend the next few years changing habits again. How can we possibly provide a service to clients without being able to see coding notices. An online version is essential.

Please can representations be made to HMRC to ask them to think again. Though on a related point Royal Mail will now be in financial difficulties!

# | by Tax Faculty Team on 14 September 2010, 15:11

In the above item we said that HMRC would be posting the news about withdrawal of agent copy forms on its website. This has now been done and is covered in our 14 September news item Forms which HMRC sends to agents.

# | by Liz Whiteley on 23 November 2010, 16:34

Please would you report what progress has been made through your representations to HMRC in making the PAYE coding information available in some electronic format, before the paper copies are withdrawn. ONLY ONE WEEK TO GO.

# | by David Robin on 09 March 2011, 12:17

I would add that not only are copies of forms from coding notices to self assessment calculations not being issued to us any longer but a number of inpectors I have to deal with on enquiries are sending letters direct to taxpayers and either delaying or not sending copes of same to us. They say its because they are obliged to: but often the content addressed is exactly the content the inspector should have addressed with us the agent - and not the same as earlier correspondence with us.

Their other argument is that their obligation is to the taxpayer not to us, it is for the taxpayer to decide if they want to share the letter with us.

Somehow this is viewed as better "customer service" by the department.....

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