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ACCA Strategic Professional · Advanced Taxation (UK) · Ethical and professional issues arising from the giving of tax planning advice

A tax adviser is asked by HMRC for client working papers during an enquiry into a client's return. The client has not agreed to disclosure and HMRC has not issued a formal notice. What should the adviser do?

The adviser should disclose only what the client authorises or what the law compels through a valid formal notice, and should ask HMRC for the legal basis of the request. Informal requests give no automatic right to client papers, but lawful notices must be complied with.

  1. AHand over all papers, since HMRC is the tax authority
  2. BRefuse and ignore the request, since all information is confidential
  3. CProvide only papers relating to the adviser's fees
  4. DDisclose only what the client authorises or what the law compels by a valid formal notice, and ask for the legal basis of the requestCorrect

Explanation

Information may be given to HMRC only with client authority or when legally compelled, such as under a valid information notice. The adviser should ask for the legal basis and seek the client's consent. Blanket refusal ignores lawful notices, and automatic handover breaches confidentiality.

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