Operational assurance overview: Large business compliance management
HMRC large business approach to tax compliance risk management
The current approach to compliance for large businesses is covered in the large business strategy and tactical delivery plan, the Risk Framework for Large Business and Tax Compliance Risk Management: Guidance for LBS Customers and Staff.
These recognise a proportionate risk-based approach which in effect means fewer interventions for low risk customers.
HMRC will do all it can to help business in their efforts to comply. The firm intention is to help cut costs of compliance for those customers who comply by establishing confidence in the effectiveness of their systems and governance processes. HMRC can then place greater reliance on them and cut the number of interventions as a consequence.
Large Business Service (LBS) will apply the HMRC approach fully to Landfill Tax (LFT) as well as all other taxes and duties.
LBS and Local Compliance (LC) Population Project 2007/08
The Project Board, comprising representatives from LBS and LC, as well as Business Customer Unit, considered the threshold for businesses to be either in LBS or LC (Large and Complex). They used the European Union definition of large business - turnover of more than 50 million euro or balance sheet total of more than 43 million euro. The Board determined that businesses with turnover of £600 million pounds or assets of above £2 billion would be the responsibility of LBS (around 1,000 businesses). LC would be responsible for the remaining 14,000 large businesses.
The current position on this project, including practical issues on handover of businesses and cases, is on the LBS site under Review of Links with Large Business Entities moving to Local Compliance from LBS Managing Customer Relationships.
Role of staff involved in tax compliance risk management
The roles and responsibilities of all LBS staff involved in tax compliance risk management, including Client Relation Managers (CRMs) and Tax Specialists are set out in and Role and Responsibilities of CRMs and Sector Leaders.
How these responsibilities are to be practically applied are exemplified in theLBS Risk Framework Policy Guidance.
For LC there are proposals for Client Relationship Management in LC.
For LFT, LBS CRMs and Tax Specialists will work with LC as partners for risk assessment and in planning interventions at LBS customers, and will ask for support from LC in line with the agreement described at LFT14030. Where LC support is given, CRMs and Tax Specialists and LC staff will work as a team on LBS customer interventions, and in particular LC will agree with LBS before issue of any letters or assessments to the business.
LBS will support the LFT Unit of Expertise in responding to specific requests for informationto help their overview of the whole regime, for example research, trend analysis.