WMBC Tax Under Considation: Company structure

Michael Wilkinson made this Freedom of Information request to HM Revenue and Customs Automatic anti-spam measures are in place for this older request. Please let us know if a further response is expected or if you are having trouble responding.

HM Revenue and Customs did not have the information requested.

Michael Wilkinson

Dear HM Revenue and Customs,
the document:
"Corporate report
Customer compliance: our approach to tax compliance for wealthy individuals and mid-sized businesses
Published 17 July 2023"
gives a breakdown of "Tax under consideration" for different categories of non-compliance.

Can you please supply a list types of "Company structure" that you expect to contribute to the target of £287,553,536 identified in that document, and the proportion that relates to Managed Service Companies and Managed Service Company Providers?
For Managed Service Companies, can you provide the Plan behind that target, including why that non-compliance is occurring and the risks that you see in the plan related to interpretation of the law and facts that may lead lesser liability or even no further liability at all.

Yours faithfully,
Michael Wilkinson

Team, FOI, HM Revenue and Customs

Our ref: FOI2023/97851

Dear Michael Wilkinson,

Thank you for your request, which was received on 6 December.

Please remember to quote the reference number above if you need to contact
us about this request again.

We aim to respond to all freedom of information requests within 20 working
days. We will either send you the information you have asked for or let
you know why we can't.

If we can't reply by 9 January 2024, we will write to let you know the
reason and when you can expect a response.

Yours sincerely

HMRC Information Rights Unit

Team, FOI, HM Revenue and Customs

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Dear Michael Wilkinson,

We are writing in response to your request for information, received 6
December.

Yours sincerely,

HMRC Freedom of Information Team

Michael Wilkinson

Dear HM Revenue and Customs,
I note your initial wholly templated response to my initial query. As the request related specifically to Managed Service Company legislation, I was surprised to hear that the "data is held on a number of different systems across different areas of WMBC".

In order to have a request that fits within your cost limits, I would like to narrow my request as follows:

The document:
"Corporate report Customer compliance: our approach to tax compliance for wealthy individuals and mid-sized businesses
Published 17 July 2023"
gives a breakdown of "Tax under consideration" for different categories of non-compliance, including a category of "Company structure" with a target of £287,553,536.

Can the "HMRC WMBC Employment Status and Intermediaries Managed Service Company Team" provide some plan details that relate to their expected contribution to the £287,553,536 target? In particular, can they provide the risks they have identified in that plan related to interpretation of the law and facts that may lead to lesser liability or even no further liability at all?

Yours sincerely,

Michael Wilkinson

Team, FOI, HM Revenue and Customs

Our ref: FOI2024/00482

Dear Michael Wilkinson,

Thank you for your request, which was received on 11 January.

Please remember to quote the reference number above if you need to contact
us about this request again.

We aim to respond to all freedom of information requests within 20 working
days. We will either send you the information you have asked for or let
you know why we can't.

If we can't reply by 8 February 2024, we will write to let you know the
reason and when you can expect a response.

Yours sincerely

HMRC Information Rights Unit

Information Rights Unit, HM Revenue and Customs

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Dear Michael Wilkinson,

We are writing in response to your request for information, received 11
January.

Yours sincerely,

HMRC Freedom of Information Team

Michael Wilkinson

Dear Information Rights Unit,
thank you for acknowledging that my request passes the Public Interest Test.
Your response contained a number of statements that highlighted the importance of making the requested information available.

1) You stated in loaded language that implies that it is wrong for people to arrange their tax affairs to avoid challenge:
"We believe releasing information that could allow opportunists to arrange their tax affairs to avoid challenge would undermine the deterrent effect of compliance".
You could have said that in a fairer way like:
"We believe releasing information that allows people the opportunity to arrange their tax affairs to avoid challenge would promote compliance and avoid punitive taxation"

2) You stated:
"it would also lessen the public confidence in HMRC’s ability to police the system. "
I have received significant feedback on your response saying not releasing the information would be trying to trap people to pay extra tax, rather than showing how they could change their tax affairs in a compliant way. Hiding the information undermines public confidence in HMRC which is being seen to be prioritising increased tax revenue above fairness to the tax payer.

3) If, as you say this is about "HMRC’s ability to police the system. " then the public would expect behaviour from HMRC that is analogous to policing. Police try to act to discourage criminal behaviour and encourage non-criminal behaviour in preference to arresting people.

4) If the grounds that HMRC are using for identifying non-compliance are robust, it would be unlikely that a non-compliant person could easily change they tax affairs in a way that avoids challenge and continues to be non-compliant. If HMRC believe that their reasoning for non-compliance are so easily avoided, it will be clear that HMRC are exploiting loopholes in legislation to make tax demands that are beyond the intentions of the legislation. It is in the public interest that HMRC are seen to be applying legislation fairly in the way it was intended rather than trying to catch people out. Not doing so will undermine public confidence in the tax system and this could damage the general climate of honesty.

5) If the information requested is not to be made publicly available, can you share the communications where HMRC invited bodies such as the National Audit Office, the Public Accounts Committee and the Treasury Select Committee to revirew the planning decisions used to set the target for tax under consideration related to Company Structure?

Please re-review your reasoning for withholding the information requested in the light of the comments above, as that reasoning appears to reinforce the need for transparency in this case, and not diminish it.

Yours sincerely,

Michael Wilkinson

Information Rights Unit, HM Revenue and Customs

Our ref: IR2024/11296

Dear Michael Wilkinson,

Thank you for your request, which was received on 1 February.

Please remember to quote the reference number above if you need to contact
us about this request again.

We aim to respond to all freedom of information requests within 20 working
days. We will either send you the information you have asked for or let
you know why we can't.

If we can't reply by 29 February 2024, we will write to let you know the
reason and when you can expect a response.

Yours sincerely

HMRC Information Rights Unit

Michael Wilkinson

Dear HM Revenue and Customs,

Please pass this on to the person who conducts Freedom of Information reviews.

I am writing to request an internal review of HM Revenue and Customs's handling of my FOI request 'WMBC Tax Under Considation: Company structure'.

This request was first received by HMRC on 6th December 2023.
HMRC responded to the initial request on 5th January 2024 with a communication that consisted almost entirely of template messages intended to frustrate the application.
While stating that HMRC definitely had the information, it would also be costly to check if the information was held.
The response also said that it be difficult and costly to determine which part of HMRC could deal with this query related to a WMBC report related to Managed Service Companies which was clearly untrue based on my later update which asked for the request to be directed to the team within WMBC responsible for Managed Service Companies.
The response also indicated reluctance to answer the request by suggesting that HMRC would seek out further exemptions.

HMRC received a clarification of the request on 11th January.
HMRC responded to the clarified request on 31st January.
In this second response HMRC accepted that the disclosure of the information was in the public interest.
HMRC acknowledged that information release would provide an opportunity for HMRC customers to arrange tax affairs in a compliant way that could not be challenged.
HMRC's response indicates that it would prefer to not disclose the information in a way that facilitates non-compliance in order to apply penalties.
The response also tries to distract from its responsibilities for FOI by suggesting that alternative forms of scrutiny be used instead.

HMRC received a challenge to the second response on 6th February and said that they would respond by 29th February.
As of 8th March, HMRC have not sent a response in breach of legal time frames for FOI.

Overall, HMRC have repeatedly frustrated the FoI Request, before finally failing to respond.
The failure to provide the information requested, not only fails to follow FoI legislation, it is also failing to disclose information that could provide evidence related to the correct application of MSC legislation in legal disputes.

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/w...

Yours faithfully,

Michael Wilkinson

Information Rights Unit, HM Revenue and Customs

Dear Michael Wilkinson

I am writing to update you on the status of your Internal Review request
and to apologise for our delay in issuing a response.

In dealing with all FOI related requests HMRC works to the standard set by
the independent Information Commissioner's Office (ICO). While we meet
this target most of time, there are some cases that take longer to
process. Your FOI request is one such case.

I want to assure you that we are still working on your request and aim to
provide a reply shortly. I will update you further should we not be able
to issue our response within the next fortnight.

Kind regards

HMRC Information Rights Unit

Michael Wilkinson left an annotation ()

Reported to ICO 4/4/24 referring to obstructive nature of first responses and failure to respond in time indicated review

Michael Wilkinson

Dear Information Rights Unit,
you told me that you would update me further if you were not able to issue a response within a fortnight of 14 March.
I have had neither the response, nor an update despite 3 weeks having passed since your communication and more than 2 months since you received my last query on the request.
Can you please provide an update?

Yours sincerely,

Michael Wilkinson

Michael Wilkinson

Dear HM Revenue and Customs,

Please pass this on to the person who conducts Freedom of Information reviews.

I am writing to request an internal review of HM Revenue and Customs's handling of my FOI request 'WMBC Tax Under Considation: Company structure'.

When I made request ref: FOI2023/97851 a response was provided that said that although you definitely had the information requested, you did not know the team best able to handle the request and that you could not advise me on where to start.
That request related to HMRC WMBC with a topic of Managed Service Company legislation.
Can you explain why:
that request was so difficult and expensive to respond to, with an implication that the request would still be rejected even if the appropriate team could be found
when:
the follow up request FOI2024/00482 was little more than asking for the request to be dealt with by the team within HMRC WMRC responsible for Managed Service Company legislation?
The original request seems extermely evasive in relation to Freedom of Information, based both on the acceptance of the follow on request, and on the templated and inconsistent answers in the first response.
In particular, the idea that HMRC definitely had the information, but had no idea where to find it was hard to believe.

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/w...

Yours faithfully,

Michael Wilkinson

Information Rights Unit, HM Revenue and Customs

1 Attachment

Dear Michael Wilkinson,

We are writing in response to your request for information, received 1
February.

Yours sincerely,

HMRC Information Rights Unit

Information Rights Unit, HM Revenue and Customs

1 Attachment

Dear Michael Wilkinson,

We are writing in regards to your complaint to the Information
Commissioner's Office, reference IC-310295-L3V3.

Yours sincerely,

HMRC Information Rights Unit