Agent operational guidance: dishonest tax agents: establishing dishonest conduct: preparing the conduct notice
Once you have established an individual has engaged in dishonest conduct as a tax agent you will issue them with a conduct notice.
A conduct notice can only be issued by, or with the approval of, an authorised officer, see CH881400. Self authorisation is not permitted.
Technical guidance about what the conduct notice must contain is at CH182140.
A conduct notice (TA1) is available in SEES Forms and Letters.
The conduct notice contains your ‘determination’ of the individual’s dishonest conduct. It is necessary to state the grounds on which the determination was made. To do this you must set out the evidence you have that shows the individual has been dishonest while acting as a tax agent.
You must only issue a conduct notice when you have sufficient evidence of dishonest conduct that would lead the tribunal to uphold the notice on appeal.
You must provide as much detail as is necessary to
- give the recipient of the notice a clear summary of the evidence you have gathered that shows dishonest conduct has taken place
- satisfy the tribunal, should they be required to hear an appeal, that your determination is sound and reasonable.
The notice must contain details of how
- the individual was dishonest
- you found out about the dishonesty
- many clients are affected by the dishonesty
- much tax was lost or could potentially have been lost owing to the dishonesty.
Using the example at CH881200 your notice might contain the following details of the dishonest conduct.
Mr Berrick submitted amended self assessment tax returns showing false claims for travel and subsistence expenses allegedly incurred by his clients during the period x to y. These tax returns generated repayments of income tax which were paid to Stoke & Church Ltd, which is a company wholly owned by Mr Berrick. The tax repayments were not passed on to Mr Berrick’s clients.
Our enquiries into x number of Mr Berrick’s clients showed that the clients had not incurred the expenditure included in the false tax returns, and had not authorised Mr Berrick to make the claims for tax repayment.
We have found x number of false tax returns submitted for y number of Mr Berrick’s clients.
These false claims have generated tax repayments of £z for the tax years xx-xx.
If Mr Berrick was a member of a professional body, see CH881600 for other information the conduct notice must contain.