The Association of Accounting Technicians (AAT) has cautiously welcomed HMRC's response to its recent consultation on protecting repayment claimants.
At the moment, while one-third of the tax sector is unregulated, it causes two-thirds of complaints to HMRC. This lack of regulation leaves customers at risk and costs the taxpayer hundreds of millions of pounds a year, worsening the administrative burden.
In the consultation, HMRC proposed actions to tackle this issue, such as legislating to replace assignments with a nomination process.
However, while the AAT welcomes many of these proposals, it claims that other suggestions would require a significant amount of time and resources not currently at HMRC's disposal.
Furthermore, because professional bodies already have the ability to monitor their members, the AAT proposes that HMRC makes membership of professional bodies compulsory for all tax advisors, not just repayment agents.
The AAT's director of professional standards and policy, Adam Harper, said:
"It's good to see HMRC taking action against this unregulated sector, including the AAT recommendation to substitute outdated assignments with the nomination process.
"However, the added layers of complexity and additional resources around a register and pre-contractual disclosures will be difficult and costly for HMRC to oversee."
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