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HMRC internal manual

Senior Accounting Officer Guidance

Tax compliance risk management process for customers managed by Large Business: role of a Customer Compliance Manager

A Customer Compliance Manager (CCM) must encourage the company to work with HMRC to deal with risks to tax compliance openly, co-operatively and where possible in real time.

As part of their normal relationship management activity, a CCM must try to understand the customer’s business and the overall level of tax risk the customer represents. This includes understanding whether the tax accounting arrangements are appropriate. So a CCM must talk to the customer about

  • how it identifies key risks to tax compliance and
  • the approach it takes to control such risks within the business.

As part of any ongoing discussions about business systems, governance and risk a CCM should

  • discuss with the company any areas of uncertainty about the operation of the Senior Accounting Officer (SAO) provisions, and
  • make sure that the SAO is aware of the date by which a certificate must be provided for a financial year, and
  • make it clear that the accounting arrangements should allow the tax liabilities to be calculated accurately in all material respects.

The CCM must not give any assurance that the tax accounting arrangements of a company do allow the tax liabilities to be calculated accurately in all material respects. However, if the CCM identifies any area that would prevent this being the case then they must draw it to the company’s attention. This is not to say that at this point the SAO may already have failed in the main duty, see SAOG14000.

A CCM should review any certificate that an SAO provides, see SAOG16600, and consider this as part of the risk assessment process of the company.

We expect there to be strong compliance with the SAO provisions, by both companies and their SAOs. However, if there is a qualified certificate or if a problem with the tax accounting arrangements is identified as a result of wider compliance work, a CCM must consider whether there has been any failure to comply with the SAO provisions by the company or its SAO. If, exceptionally, there has been a failure, the CCM must consider the potential penalty position.