New tax dispute scheme put to test

A pilot scheme has been launched for a new way to resolve disputes between SMEs and HM Revenue & Customs (HMRC).

The Alternative Dispute Resolution (ADR) uses independent HMRC facilitators to resolve disputes between HMRC and small and medium-sized enterprises during a compliance check but before a decision or assessment has been made.

The pilot, which will run in North Wales and the North West, follows a successful trial in which 60 per cent of disputes were either fully or partially resolved.

HMRC’s Jim Stevenson, assistant director, local compliance, said: “ADR will help SMEs resolve disputes without having to go to a tribunal – saving them both time and money. The facilitators are HMRC members of staff who have been trained in ADR techniques and have not been involved in the dispute.

“We have found that often there are communication problems. So the HMRC facilitator will help all parties reach a shared and full understanding of the disputed facts and arguments. The aim is to resolve the dispute or, if not, as many issues as possible.”

ADR does not affect existing processes or review and appeal rights, and covers both VAT and direct taxes.

Link: HMRC and ADR