Advice and accountability

[Theyreeatingthedogs]

BBC News - Rayner at risk of fine over stamp duty, tax experts say
https://www.bbc.com/news/articles/c62n366q306o

Although I've linked to a Rayner article my question does not specifically relate to her. In the article it says she may be fined. However, it seems that she was given advice by professionals. I think that IF, and that may be a big if, they gave her incorrect advice should they not also be liable to a fine. It seems unreasonable to me that if I ask my accountant for advice, I act on his advice and end up with a fine from HMRC, the accountant gets away with giving incorrect advice but I would be fined.

The mistake that was made was so basic that the advice cannot possibly have come from a professional in the field, unless she lied to them about her actual circumstances.
Either way it’s her fault. She either didn’t get proper professional advice, or she gave incorrect information.

So lawyers, accountants etc don't make mistakes? You don't know what happened, neither do I. It's not about her case as I said. It's in general, that HMRC will fine the tax payer for a mistake even if that mistake was made by the professional.

This is why legal professions are required to adhere to the rules and standards set by their regulatory body - which is to give accurate, quality advice to the best of their knowledge (i.e. in terms of what the client has disclosed). Where it gets muddy is whether or not the client given all of the information required for the advice to be accurate and high quality.

It's interesting that Shoosmiths have come out and said: "Not us, in case anyone was speculating!" And her explanation is that her advisors didn't “properly take account” of her circumstances. Well is that the case or did she not give a full and proper account of her circumstances?

Personally I think in her position she needs to be watertight on everything - both doing the right thing and being seen to do the right thing. We don't have enough information to be able to judge either way, but the fact that it took a media outlet to bring this to light is troubling - much like in the case of 2009 MP expenses.

I will never forget the name Peter Viggers, nor the word 'duck island'. RIP.

They don’t make THIS mistake. It’s as basic as basic can be.
It would be interesting to hear who she got the tax advice from. I’m suspecting an estate agent or conveyance solicitor. I’m also guessing she lied to them about her circs.

What mistake? You seem to have inside knowlefge. Tell us exactly what mistake was made. Ah, now I see, you "guess" what happened.

Even I a mere pleb to her standing knows she did wrong and was tax dodging

we only have her word she took advice and I remain to be convinced

Any Tory did this and you would all be baying for their blood

she needs to resign

The ‘mistake’ has been reported - ie whether the fact that she had put her share of the family home ‘in trust’ for her kids meant that it wasnt counted as her main residence even though in fact it was her main residence as her and her husband were both using it via ‘nesting’. The guidance states that even if a property is placed in trust, it should still be counted as a main residence for the purposes of stamp duty on another property.

Yep! And @Theyreeatingthedogs.... Hi Ange! 👋👋

If your accountant/advisor gave you poor advice to the extent that you were fined by HMRC, you would in turn be able to claim against their professional indemnity insurance. If they haven't go that, a) they're not professional and b) you take them to court.

It’s in the public domain that it was a question of whether it was her primary residence or a ‘second home’. No tax expert would make an incorrect analysis of which it is and what tax is therefore due, as long as she gave accurate information to them.
She is now saying that she does have another home and has set up a trust for it to go to her disabled son. It’s still her house though.
She either didn’t consult a tax expert, or she did, but gave them inaccurate info.

It's no longer her house. She sold it to the trust. It is very complicated. Even though she does not own it, it appears that it still counts as her primary residence as her children live there and she takes it in turn to live there alternately with her exH to parent their children. An admirable way to parent their children after divorce. We do not know what she told her tax advisors or what questions they asked her. Hopefully that will come out soon.
This was not my AIBU question. My question was purely about relying on "experts" for advice and them being allowed to get away with bad advice.
The Raynor haters have jumped in and made it about her. This is what is wrong with modern politics/society. Typical Farage type hate. The truth doesn't matter, let's just rabble rouse.
To make it clear I have never voted Labour and never will.

I am aware of that. However it is a costly business to go after an accountant/lawyer for redress. It would be much more efficient and fairer that if you could prove to HMRC that you were acting on their advice, HMRC could fine them. It would make them more accountable.

I don’t hate her! She’s a strong, independent woman!
She got this badly wrong. Her house is in a trust, but she is a trustee. It’s very basic stuff.
She either didn’t get advice or she lied to her advisor. It’s not the ‘mistake’ that will get her, but her badly thought through ‘cover up’. She’s toast.

As to your broader question (you brought up Rayner, not me, btw! 😂), HMRC has a relationship with the individual. If they get it wrong, they don’t care what advice they sought or received - they punish the individual.
If you are the individual, you can seek advice but need to carefully check the terms and conditions of that advice and make sure you’re asking the correct professional - you may need multiple advisers if the issue involves different facets. If a mistake is then made by that adviser, the individual has comeback (assuming they gave all the correct information to start with, of course). Professionals are insured against such claims, and they’re actually vanishingly rare.

It’s not at all expensive to go after an accountant - it’s done through their professional body and their insurers. Not a regular occurrence though - any mistakes are usually ones of disclosure by the client.

Anybody with a half-operational braincell would have got (paid for) professional advice in writing. All Ms Rayner has to do is publicly provide this written advice, suitably redacted if necessary. This would neutralise the perjorative comments and give ample grounds for redress from said professional advisors.

If her advice was verbal then it is worth the paper it is written on ! and stretches credulity that someone like her would rely on such advice

It's not for HMRC to determine who is at fault for the incorrect advice. How would they even know that the individual is telling the truth about seeking advice? In most cases, I would expect it to be due to factual omissions by the client so why on earth would HMRC fine the accountant/advisor? HMRC's relationship is with the individual anyway, not the people providing advice.
It is costly to pursue through the courts (it shouldn't get to that stage though as the indemnity insurance should sort it out) - that is what legal expenses cover is for which the individual should have either via their business insurance or even their house insurance policy.

Glad there is a thread on this. While I do sympathise a little with her because I recognise many men in similar positions - Farage's tax hoards, Boris, all the offshore account men etc - don't ever get their dues for FAR more £.

However, this govt have continued with the Tories plan of taxing the middle classes out of any savings - laying "traps" on the easy pickings of law abiding people who pay taxes and are on the HMRC system.
Now this lot are getting 2nd houses they are falling foul of the system they've invested so much in to regain a pittance compared to the super rich they should have been fighting.

Hoisted by their own petard, springs to mind.

Yes. As a solicitor of financial advisor you will hold professional liability insurance to pay for claims such as just that.

The advice she was given was to seek specialist advice. She didn’t.

I’d be surprised if she had any redress