Following a successful pilot, the “Alternative Dispute Resolution” process can now be requested by individuals and SMEs, whether or not an appealable decision has been made by HMRC, with the dispute then proceeding to mediation conducted by an impartial HMRC facilitator.
According to Mike Down, head of the tax risk and investigation management group at Baker Tilly, the move is a welcome one as it “less adversarial and, perhaps more importantly, quicker way of resolving a dispute with HMRC without having to resort to taking appeals to the Tax Tribunal”. In addition, it will reduce costs for taxpayers.
Down explained that the mediation follows a defined process whereby each side begins by setting out its case, the facilitator then conducting some “shuttle diplomacy” to bring out answers to points in dispute and to identify possible areas of compromise on the facts and interpretation. Finally, everyone is brought back together to try to reach agreement.
