HMRC calms agents' fears over facsimile tax returns

In the latest move aimed at clarifying its stance on Lord Carter's recommendations for online tax services, HMRC has reassured agents that they will still be able to print out paper copies of tax returns from preparation programs.

In his review of the Revenue’s online services, Lord Carter recommended it should "stop accepting SA returns on paper substitutes from April 2008". The idea was to force advisers to file their clients' tax returns online by not accepting the forms generated by their tax software programs. It is believed that significant resource is taken up verifying software houses' facsimile designs and Lord Carter suggested the measure as a way to discourage people from printing out substitute paper returns and filling them out by hand.

An HMRC spokesman said: "We recognise that agents have their own processes and mechanisms for dealing with their client's returns. As technology is rapidly evolving in this area we have not been prescriptive about the form of the copy return - it could be an electronic or paper copy - or in the form of the client's signature - similarly, it could be an electronic or 'wet' signature."

The current guidance, set out under regulation 3(6) SI 2000 No 945, says that agents should make a copy of an SA Return (including any amended SA return) and ensure it is authenticated by the taxpayer through a signature confirming that the information is correct to the best of their knowledge and belief before the return is sent in, the spokesman explained.

"The Carter recommendations do not include changing this position. The references in the recommendations to the use of 'paper substitute return forms' was intended to cover the question of whether HMRC should continue to accept such forms," he said.

Lord Carter's proposal not to accept the forms for submissions to HMRC will be taken up post 2008, but agents will still be able to generate copies of returns for their clients from their tax software.

Software developer CCH received feedback from customers who were concerned that the Carter report would prevent any substitute forms from being printed, stopping them from outputting copies for clients.

ICAEW council member Susan Gompels was one of many accountants who lobbied for the clarification, which she welcomed.

"As advisers we need the full facsimile to provide suitable document for our clients to approve and sign. It gives us also a vital 'fall-back' option which could be used in extremis, should there be an unexpected failure of the e-submission system," she said in a statement issued by CCH.

"Without a facsimile the only alternative would be to complete HMRC forms by hand - hugely costly for all, prone to error, and a significant step backwards in this age of e-filing."