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

Tamsin, a tax adviser, learns from a long-standing client, Orrin Ltd, that it has deliberately understated its corporation tax profits in a prior return. Which statement best describes Tamsin's position regarding confidentiality?

The adviser should press the client to correct the error. If the client refuses, she should consider ceasing to act and whether a money laundering report to the NCA is required. She cannot simply tell HMRC, because confidentiality applies unless law or consent permits disclosure.

1. AShe must keep the information confidential and may never disclose it to anyone without the client's consent, whatever the circumstances
2. BShe may report the matter to HMRC immediately without notifying the client, because tax advisers owe their main duty to HMRC
3. CShe should urge the client to correct the error, and if the client refuses she must consider ceasing to act and whether a money laundering report to the NCA is required, rather than simply disclosing the error to HMRCCorrect
4. DShe should continue acting as normal because an error in a prior period is not a matter for the adviser