Tax  

Govt considers mandatory PI cover for tax advisers

The tax man could decline to interact with any tax adviser, unless they demonstrate that they have the correct cover.

There is also a risk that advisers could move offshore to avoid this requirement but the tax authority said this could be avoided by “requiring anyone who carries out tax advice in this country, regardless of where they are based, to be subject to mandatory professional indemnity insurance”.

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The government may also make it a new offence to provide tax advice without holding PII to stop individuals flouting the rules. 

In addition, there may need to be sanctions for not holding adequate cover, or for taking out cover but not paying premiums.

Today’s consultation comes after the taxman warned of "incompetent, unprofessional, and actively corrupt" tax advisers when it launched its call for evidence in this area back in March 2020.

The government first confirmed it would be launching a consultation into raising standards of tax advice in Budget 2020 and in the call for evidence it said it wanted to insure taxpayers received "competent, professional and trustworthy" advice. 

amy.austin@ft.com

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