Senior accountants 'face business tax liability'
24 Apr 09
Senior accountants could be made personally responsible for their organisation's tax arrangements as part of proposals included in Wednesday’s Budget
Included in the document were plans which would see senior accounting officers at large firms "take reasonable steps to establish and monitor accounting systems so that they are adequate for tax reporting purposes".
The rules, which would be part of the finance bill 2009, will also commit those in such a role to certifying that accounting systems are suitable for the task.
Any problems with the system will have to be communicated to HM Revenue and Customs (HMRC).
Simon Wilks, tax investigations network leader at PricewaterhouseCoopers, said: “In addition to these obligations on the senior accounting officer, large companies will also be obliged to notify HMRC of the identity of the senior accounting officer. Companies will want to consider how they respond to these changes and in particular, what they need to do to underpin the new certification procedure.”
Angus Johnson, global tax function effectiveness business leader at PwC, added: "The new provision significantly increases HMRC's armoury in this area and its personal impact will undoubtedly have a mind-concentrating effect on the chief financial officers and others in large companies."
Those who think they may be affected by the changes should start preparing now, rather than waiting for the law to come into force, he added.
These new requirements will be backed up by provisions providing for up to £5,000 penalties chargeable personally on the senior accounting officer for careless or deliberate failure to comply with these obligations. Similarly there will be company penalties for careless or deliberate failure to comply with the notification obligation.