HMRC bypassing solicitors to send its so-called ‘nudge’ letters is an activity that would be deemed highly suspect in any other litigation area.
That is the view of law firm RPC which has been studying the practice.
The tactic involves letters being sent directly to individuals involved in tax disputes instead of their lawyers or accountants. The letters have earned their nickname amid complaints that the language seeks to psychologically ‘nudge’ people towards settling.
RPC says the act of approaching clients directly would amount in other litigious matters to applying undue pressure and, therefore, be frowned upon by regulators.
As an additional measure, HMRC has also set up its own ‘nudge’ unit to target high net worth individuals and other taxpayers that they suspect of not paying the correct amount of tax.
Additional RPC research suggests that more than 3,800 tax investigations by HMRC local offices remain unfinished three years after they began. According to the data, there are now more than 115,000 open tax investigations against businesses and individual taxpayers, which leaves those under investigation to bear the costs and disruption.
While individuals bypassing the expert advice of accountants and lawyers is not as questionable as HMRC’s practices, it is, of course, never a good idea. But at Moore Thompson, we think lawyers should talk to us too – especially if they are facing tax issues. We are experienced in dealing with the legal sector and our experts our sure to have insight into your business. For more information about what we can do for solicitors, please contact us.