HMRC has lost the first appeal to be heard at tribunal in relation to the senior accounting officer (SAO) regime. Bill Dodwell, partner and head of tax policy at Deloitte considers the implications for accountants
The Senior Accounting Officer (SAO) regime was a surprise introduction to UK tax management in 2009. It applies to some 2,200 businesses with turnover exceeding £200m. The aim is ‘to ensure that the accounting systems in operation within large companies liable to UK taxes and duties are adequate for the purposes of accurate tax reporting’. The rules come with £5,000 penalties chargeable on the senior accounting officer personally and on the company for careless or deliberate failures.
HMRC initially applied the rules with a light touch but penalties are now levied for failures. CCH Daily reported in 2015 that penalties had ‘doubled over the last 12 months to 155 (2014/15), from 73 issued in the previous year’. Almost all penalties were for procedural failings, such as failure to notify the identity of the SAO and making late returns.
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