Convictions for tax evasion by HM Revenue & Customs (HMRC) are expected to continue on an upward trend due to increased targets, the creation of new HMRC taskforces and the increased use of technology to tackle tax evasion.
Prison sentences for acts of dishonestly defrauding HMRC are likely to become more prevalent, and few people will feel any sympathy for those who deliberately evade tax.
Honest mistakes can also be penalised, and with increased targets and pressure on HMRC to increase its tax collection, we are unlikely to see much leniency given to the taxpayer. Inaccuracy penalties apply to errors which understate or misrepresent a tax liability. The penalties charged depend on the severity, starting from up to 30% of the additional tax due for a lack of reasonable care, going up to 70% for deliberate errors.
So with penalties at nearly a third of the error, the lack of reasonable care when dealing with tax can be very costly. A lot of trust is placed in the hands of accountants to deal with tax correctly, but how do you know they are getting it right?
Would you use a Quack (unqualified doctor)?
Surprisingly the term Accountant, unlike Doctor, Dentist or Solicitor, is not a legally protected name. Even those without any background, experience or training can trade as an accountant. All they generally need to do is put up a sign above the door saying “Accountant”, and they are in business. In my experience most people would not use the services of an unqualified Doctor, Dentist or Solicitor and similarly would be uncomfortable using the services of an unqualified accountant.
Benefits of a qualified accountant
A qualified accountant is regulated by his or her professional body and is of course required to pass rigorous exams before admission to membership. Once admitted he is required to demonstrate that he has kept himself up to date with legislative changes, carries professional indemnity insurance and adheres to ethical rules of conduct. His work may also be independently inspected at regular intervals to ensure standards are being maintained.
How to tell if one is qualified
A qualified accountant will be evident by their own name being followed usually by the letters ACA, FCA, ACCA or FCCA and their firm’s name usually includes Chartered Accountants or Chartered Certified Accountants.
All accountants at CloudBook are qualified and carry one of the 4 qualifications above. Contact us today for a service you can trust.