UK Revenue Official Defends Enabling Letters

by Jason Gorringe, Tax-News.com, London

28 September 2004

In a recent interview with Taxation magazine, Inland Revenue official Marjorie Williams defended the tax authority's much-criticised initiative of sending enabling letters to thousands of self-employed taxpayers suggesting that their tax returns may have contained errors.

Accountants and taxpayers alike have slammed the move, arguing that it has caused unnecessary stress for the latter, and has created a climate of distrust between accountants and their clients.

However, Ms Williams, who heads the Revenue's service delivery support sector, argued that the letters are likely to have reduced the need for formal enquiries into self-assessment tax returns at a later stage.

"By providing targeted guidance on such areas of error, the Revenue aims to help people get things right in the first instance, before they submit their return, minimising the likelihood of an enquiry," she explained, observing in conclusion that:

"We firmly believe that pointing out things we commonly see that people get wrong, or that we might need to enquire into if they appear to feature in the return, is likely to be a more welcome approach than a formal enquiry. And, by keeping formal enquiries to the minimum number that is consistent with the Revenue’s responsibilities of care and management, we can concentrate our resources on cases where the risk of tax loss is greatest."

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