HMRC has issued revised guidance on the responsibilities of the senior accounting officer (SAO) in companies.

Brief 19/13 gives an overview of recent updates to SAO guidance and clarifies HMRC's interpretation of the SAO rules. Updates include the form of certificate that an SAO must provide to HMRC as prescribed in HMRC's SAO Guidance (SAOG), clarification of HMRC's interpretation of the 'turnover test' and an example of balance sheet aggregation.

There is also clarification that the concept of 'in all material respects' should be considered in relation to a company and not a group.

HMRC has also updated the responsibilities of an incoming SAO in relation to the period covered by their predecessor.

When a new SAO is hired, the SAO must issue an unqualified certificate stating that the company had appropriate tax accounting arrangements throughout the financial year. The SAO should make this statement if the company had accounting arrangements that enabled it to accurately calculate all its relevant liabilities.

In the event that the tax accounting arrangements did not comply with HMRC rules, in future the SAO must state that the company did not have appropriate tax accounting arrangements throughout the financial year and explain in what way the arrangements were not appropriate. Such a statement is called a qualified certificate.

In the event of a liquidation or administration, where a person is determined to be the SAO HMRC does not expect that person to investigate and report on the systems in place prior to the liquidation or administration. This is because significant other matters will be of greater priority in the liquidation/administration period. However, if that person comes in to possession of information relevant to the period of the financial year prior to the liquidation they will be obliged to make the appropriate comments on the SAO certificate.

For full details of the guidance, go to HMRC Brief 19/13