An exciting and exacting time to be a taxation professional
Accountancy & Tax It is reassuring to see that the tax profession continues to attract and reward talent despite taxation going through a period of change, domestically and globally.
Accountancy was among the top sectors in which companies planned big increases in their graduate intake last year. In fact, a survey published this year by Randstad found that the accountancy profession is one of the most recession-proof private sector professions in the UK. The analysis shows that, over the past 12 years, the total salary bill across the full-time accounting profession has increased by 11.5 per cent.
I suspect the interest in a career in tax among UK graduates is being replicated by peers across the world. There is certainly greater interest in cross-border taxation, as can be seen in the rapid growth of the CIOT delivered ADIT (Advanced Diploma in International Taxation) qualification, which now has graduates or students in more than 100 countries.
This is a reflection of the public’s need and respect for expert assessment of their tax liabilities, which may be a consequence of the increasing complexity of personal and business taxation. By March 2015, the Office of Tax Simplification found that the number of tax reliefs in the UK has risen to 1,156. From 2009 to 2015 the number of pages in the tax code in the UK grew by about a third.
The profession is likely to remain in the spotlight because public debate about the relationship between businesses especially and tax is at an unprecedented high.
There is also the likelihood of more change when a new chief executive of HMRC is in place after Dame Lin Homer’s decision to step down this spring.
The profession is likely to remain in the spotlight because public debate about the relationship between businesses especially and tax is at an unprecedented high. If a company based in country A uses staff in country B to make sales to country C how do you divide up the taxing rights? These kinds of questions, once debated only by a handful of specialists, are now the stuff of newspaper front pages and the TV news. At the Chartered Institute of Taxation we draw on the expertise of our staff and members to try to explain how the system works – and why it works as it does - to the media, politicians and the public, to help create a more informed debate.
Globalisation means there is a greater need for advisers with international tax skills to serve people whose interests span different jurisdictions. It is now common to hear government ministers in different countries talk of the need for intergovernmental agreements to promote a fair tax system. The OECD may have published its much anticipated report on reforming the international tax rules, but the job is only half done; implementation will be at least as tricky as the work done so far.
The internet is largely responsible for the need to reframe the international tax rules, and it is having an impact no less revolutionary on purely domestic taxpayers. By 2020, most businesses, self-employed people and landlords will be required to keep track of their tax affairs and update HMRC at least quarterly through their digital tax accounts. Any thoughts that digital accounts and the whole HMRC Making Tax Digital plan will reduce taxpayers’ need for tax advice can be dismissed; there will be more onus on taxpayers to supply information to the authorities in a prescribed form, at the prescribed time, with increasingly tough measures for a failure to comply.
Tax advisers will continue to be very much be in demand in 2016 in this dynamic working environment.