On 26th July 2011, the Guardian reported that “Fiona Bruce’s former accountant was facing ruin today, after formally being told by the taxman that it would no longer deal with him. The decision will create further complications for the thousands of freelance clients working in stage and screen who depended on Christopher Lunn and Company.”
The newspaper article continues: “HMRC told Lunn today that it would no longer recognise any returns filed through his East Sussex-based firm. The taxman is pursuing Lunn and his 7,000 clients for what it believes is £117m in unpaid tax. In a court judgment published in February it emerged that HMRC believed there were systematic errors in tax returns filed on behalf of clients by Lunn’s firm.”
HMRC “raided Lunn’s offices in June last year, with Lunn and his son Jonathan arrested and interviewed under caution. The taxman is pursuing a criminal investigation into the firm and a separate civil inquiry into Lunn’s clients to claw back unpaid tax.”
“Permanent secretary for tax Dave Hartnett said: ‘HMRC decides to stop dealing with tax agents only in exceptional circumstances, where we have reason to believe there may be serious irregularities in tax returns and accounts.’”
This is the same Dave Hartnett who, last year, (allegedly) ‘negotiated’ a deal with Vodafone to let the company off a tax bill of £4.2 billion. The Guardian also covered this story in October 2010 — and Private Eye magazine has been banging on about it for even longer.
Private Eye issue 1293 (22 July – 4 August 2011) says that “A report from the National Audit Office (NAO) on HM Revenue & Customs’ ‘resolution of tax disputes’ — prompted by the Eye’s revelations of the dodgy Vodafone deal — confirms that all is not as it should be among the department’s top brass and in Britain’s largest companies. … In four big cases” (almost certainly including the Vodafone case, says the Eye), “the proper procedures were ditched in favour of ‘specific governance arrangements’” — which involved “sign off by the commissioners without prior reference to the programme board”. In other words, says the Eye, “Vodafone-style deals were done privately by Dave Hartnett without correct clearance.” Hartnett is one of those commissioners, and the Eye alleges that in three of the four big cases investigated by the NAO, “the commissioner who negotiated it himself [is] again almost certainly Hartnett!”
Hmm. So HMRC are chasing £117 million in allegedly unpaid taxes by soft targets like “TV stars”, against the £4.2 BILLION Hartnett allegedly let a corporate giant avoid? (Never mind all the others.) This apparent tax avoidance, allegedly achieved with the help of the permanent secretary for tax, may of course be speculation, hence the word ‘allegedly’ scattered liberally throughout this item — but little people like us will never know for sure because, as the Eye reports: “The cosy deals … remain immune from scrutiny to protect ‘taxpayer confidentiality’…” Which only adds insult to taxpayers’ injury.
Seems to me that if we are truly “all in this together,” as we keep being told, there are “serious irregularities” within HMRC that the ConDem government should be investigating urgently.