The taxman is seeking new 'customers' (their preferred term for taxpayers), it has been recently announced.
HM Revenue and Customs (HMRC) have announced measures to identify taxpayers with complex personal returns (CPRs). CPRs are returns which show complex features such as substantial land, property, foreign or trust income or ones where there are issues of residence or domicile which will affect the assessment of income to UK tax. For example, owners of 'buy to let' properties or who have properties abroad may well come under the definition.
CPRs are dealt with by specialist teams, who deal with all aspects of the tax affairs of their ‘customers’. HMRC are undertaking a process by which they intend to identify up to 6,000 new customers during 2006-7. How this is to be done has not been stated, but HMRC are making increasing use of their powers to compel financial institutions to reveal the identities of customers with foreign bank accounts and share transactions. If you are identified as a potential customer of the CPR unit, you will receive a letter advising you that your case is being transferred. CPR teams operate in very much the same way as tax inspectors used to work several years ago in that you will be assigned a tax officer (called a ‘caseowner’ in HMRC-speak) who will be the first point of contact for all communications.
It is safe to say that any self-assessment return assigned to a CPR team will be scrutinised more carefully than a ‘normal’ return. It is important, therefore, that if you do get a letter advising you that your tax affairs are being transferred to a CPR unit, you make doubly sure that they are in order.