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Banks could be named in tax avoidance scheme

Under plans by HM Revenue and Customs, banks could be named should it be revealed that they are be playing a part in tax avoidance.

So it is more important than ever for a business to have a reliable accountant in Heswall or wherever they are based, as a professional can steer them in the right direction, even when their bank may not.

Should the move go ahead, it would see increased pressure placed on banks with regards to any involvement in tax planning, legally, on either their own or their client’s account. In 2012, Barclays decided to close its tax planning unit in an attempt to improve its reputation after a number of scandals, which includes fixing the rates offered between banks.

It was reported later that the bank’s tax planning unit managed to generate £1 billion each and every year from 2007 to 2010.

In 2009, Alistair Darling launched A Code of Practice on Taxation. It was then seen as an informal agreement which the banks accepted in order to cut down use of any tax planning schemes.

A bank helping its customers to play a role in legal tax planning and not going along with the ‘spirit of the law’ may be viewed by HMRC as failing to adhere to the code. HMRC’s proposals would see banks without a statutory right to appeal preventing HMRC from naming them.

The code is a voluntary one. HMRC, however, is asking that banks be more committed to the obligations of the code with full knowledge regarding the proposals.

Posted by Louise
June 25, 2013

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