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BKM507650 | HMRC Operation of the Code: Relationship

From HM Revenue & Customs · Banking Manual

Examples of what a Code compliant relationship looks like

  1. Where HMRC is conducting enquiries it will take the time to fully explain the risks and suggest to the bank the information that it thinks could be used to address those risks. HMRC expects banks that have adopted the Code to be transparent and proactive in their relationship with HMRC.

  2. The bank fully discloses significant uncertainties re tax matters.

  3. The bank focuses on significant issues when making disclosures to or seeking clearances from HMRC.

  4. The bank seeks to resolve issues before returns are filed where practicable.

  5. The bank engages in a co-operative, supportive and professional manner.

  6. The bank works collaboratively with HMRC.

  7. The bank is fully committed to the undertakings it has given under the Code.

  8. The bank is fully committed to a shared plan to resolve any delivery concerns.

HMRC would have concerns where a bank fell into any one of the examples below.

Examples of where a bank’s relationship with HMRC may give cause for concern

  1. The bank exploits the information bias between HMRC and the bank by answering only the narrow question asked without considering whether a broader explanation might be more appropriate and useful to HMRC.

  2. The bank fails to disclose fully significant uncertainties regarding tax matters.

  3. The bank fails to focus on significant issues.

  4. The bank does not seek to resolve issues where practicable before returns are filed.

  5. The bank does not engage with HMRC in a co-operative, supportive and professional manner.

  6. The bank is not working collaboratively with HMRC.

  7. The bank is not fully committed to the undertakings it has given under the Code. In particular the bank has provided misleading information or otherwise concealed information either at the time a transaction was undertaken or in seeking to address concerns in respect of that transaction.

  8. The bank is not fully committed to a shared plan to resolve any delivery concerns.

See BKM507700 for an example of concerns over a bank’s relationship with HMRC.