Monday, May 25, 2009

Rentoul is Wrong on Tax Returns

John Rentoul posts on the story that Labour Cabinet Ministers are using taxpayers' money to pay their personal accountancy bills. He sees nothing wrong with that. Apparently being an MP makes tax returns so complicated that they are forced to use accountants.
I know this is a moral failing on my part, but I find it hard to work myself up about this. Simply because these people are MPs, their tax status is complicated. They would not need an accountant if they were in conventional salaried employment. Elliot Morley is pilloried for failing to do his paperwork properly; then when Darling employs someone to do it properly for him, he gets in the neck for that.
The trouble is that the rest of the world doesn't see it like that. The rest of the world thinks: well if I can't get my business to pay for my accountancy needs why should MPs be able to? They don't care if it is within the rules. They think it shouldn't be. Even those in salaried employment find tax returns complicated and use accountants to fill in their tax return.

Rentoul does, however, think that Harriet Harman is in a bit of trouble for spending £10k on media training. He reckons she will have to pay it back. I wonder if the Prime Minister will regard it as "completely unaccetable behaviour".

42 comments:

Anonymous said...

And it's also the case that if the Chancellor of the Exchequer can't figure out how to do his own tax return the system must be a bit complicated, innit?

Non Runner said...

So, Iain, when you were a director of Politico's did your accountant bill you separately for personal tax advice and corporate tax advice?

Or did he do what most accountants obligingly do for their small company clients, and wrap it all up in a single bill to the company?

Just asking...

:-)

William Blakes Ghost said...

What makes me laugh is that Dead tree Press journalists like Rentoul see themselves detached from the political class whereas as the rest of us see them as integral to it.

In fact in serving their often off-shore media-mogul masters they in fact were likely responsible for the rot that has set into the rest of the political classes with their collusion, distortions, petty agendas and lies.

Now they walk hand in hand with the rats of the political classes down in the sewer. Consequently, they receive the same contempt.

Rentoul is just another lacky of the political classes and he is talking nonsense.

Our Prime Minister is rotten, Our Cabinet is rotten, Our Parliament is rotten, the political parties are rotten and so is the Westminster Lobby.

It's time the whole sewer was flushed of all its detritus......

dearieme said...

Rentoul is being dim. The issue isn't whether it's wise to use an accountant, the issue is Who Pays?

Grumpy Old Man said...

Ref Harriets media training. I saw somewhere( sorry, can't remember where), that media training has morphed into specialist assistance with speech writing and that sort of thing. Apparently Harriet says that she's now within the rules. So that's all right then. Move along. nothing to see here.
wv: turdib (turbid. Geddit?)

Scary Mary said...

Why do you keep putting in little digs to support Blears - as per your final line. She acted like a crook - sure, so did Hoon et al, but why don't you come out and say that she should resign?

Dan said...

Agree either it should be allowed as an expense for all self employed and or small business or it should not be allowed for MP's. I would accept they are in a different position from standard salaried employee but are they any different from a small GP practice with a few staff.

The problem I have is the Telegraph condemming half the cabinet for taking advantage of this exemption but without the context, was it only 9 of 650 or was it 625 of 650?

In terms of Media training again sorry but if part of the job is to appear on the media then training to do it well would seem a legitimate expense.

The big issue here is the propoerty market if we are paying for their second mortgages we should get to keep the property when they lose their seat.

Plato said...

Rentoul is spouting rubbish.

Isn't he paid enough already to cough up for his own tax advice since he and Gordon have turned the tax system into a Byzatine nightmare?

I find the whole entitlement culture at Westminster quite revolting and so out of touch.

I do wonder what they spend their salary on.

Plato said...

PS I notice Nadine is back up

Petr said...

But surely the fact that he used accountants to assist him isn't the main point (maybe he was just too busy to do it himself). What sticks in the craw is that he expects us to pay for it.

Ruth@VS said...

How "complicated" is it? Isn't it because these MPs have (a) been renting out property we have paid for or (b) trying to ensure they don't have to pay capital gains tax?

I for one take exception to an MP charging me for their tax advice. Filling in a self-assessment return is not unduly onerous, the only reason I use an accountant now is because I now have a business to deal with as well as personal tax affairs. And by the way, the work my accountant does for me (including business accounts!) is a hell of a lot cheaper than the MPs have been paying for in their employed but apparently "complicated" lives.

britom said...

If it is so complicated and allowed in the rules, why didn't the majority of the cabinet do the same thing?

Anonymous said...

Plenty of businesses provide help with their employees tax returns when their circumstances are complicated - and their are plenty of accounting firms trying to sell such services to businesses.

VotR said...

If Harman and her manhate constitutional reforms get the sack, we should hold a street party every year on that date.

Such a feminist Nazi. How can the far left justify themselves when they deceive their way into the highest halls of power and the taxpayer that they want to put out of work and stay out of work (i.e. white middle-class males) pays for them to get there? Disgraceful, Harriet. For shame.

Anonymous said...

Does the fuss over Harriet Harman's bill for media training imply that no other MP has taken any training to improve the way they do their job?

Anonymous said...

That lot are quite rightly feeling the embarrasment of comparisons to "my employer would not pay for that so why should they get it?"
But if you were a senior director in a company and you had a lot of exposure to the media, then undoubtedly they would pay for media training. So I don't see anything wrong with that at all.
There are 4 layers to this expenses cake. Layer 1 - expenses claimed within both the letter of the rules and the spirit. layer 2 claimed within the letter of the rules but not within the spirit. Layer 3 deliberately manipulating your own personal circumstances to obtain maximum benefit from the taxpayer to your own financial advantage; and layer 4 - outright fraud - claiming for non-existent items or for someone else's benefit.
examples - layer 1 speaks for itself, layer 2 would include items for such things as maintenance such as cameron's wisteria or prescots toilet seats. Layer 3 would include flipping more than once or unneccessary items (a duck house?) and layer 4 the interest on non exixtent mortagages. We (the public) should draw a line under layer 2 as it is now a distraction and they (the MPs) should embarass the layer 3s into resignation or withdrawal of the whip and layer 4s should be reported to the police.
There are too many layer 3s and 4s still avoiding the consequences of their actions and we won't take them seriously until we see real action and not just fine words.

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Iain Dale said...

Non Runner, I have always paid for my personal tax return personally. So there!

sobers said...

You can claim the accountancy expenses for your BUSINESS affairs against the tax liability of the business (and reclaim the VAT element of the bill), but your PRIVATE tax affairs are non deductable. You should get your accountant to separate out the different elements and bill individually. Otherwise the VAT man and the Tax man will have something to say if you're inspected!

Alex said...

Rentoul is wrong, as is the Labour Party who claim iy s OK according to the Green Book. The Green Book says expenses are allowable where incurred wholly and exclusively for fulfilling parliamentary duties.

Filling out a tax return is nothing to do with parliamentary duties. It is a requirement that follows from having earned income in the UK.

John Moss said...

An MP has both their own salary and expenses and they employ their staff.

It seems reasonable that accountancy advice is chargable for the element relating to the employment of staff, but not for sorting out MPs own tax returns, especially, as Darling appears to have done, when it relates to the tax on his four home investment portfolio.

All the more case for MPs to be set up as small businesses, paid a fee to cover all their costs and Her Majesty's Revenue and Customs to apply the same rules to them as they would to any other small business. Which by the way, would allow the accountants bill as a business cost, not a tax-free expense.

Mark M said...

Rentoul? RenTOOL more like.

It's fairly simple. If it looks like income, smells like income and you spend it like income - well then, you tax it as income.

Simples..

jafo said...

I am glad John Rentoul is paid so well he is happy to personally pay for the Chancellor's tax returns - however, I'm not - and I'm certainly not!

If I can't manage my own tax returns I have to spend my own money paying an expert. Lots of people have to do the same.

Elliot Morley hasn't been "pilloried for failing to do his paperwork properly" - he has been criticised for claiming thousands from the taxpayer for a mortgage he did not have. One waits to hear the legal verdict on him, but to those of us "ordinary people" that tends to sound rather like fraud - not sloppy paperwork.

Harman's media training? Apart from wondering what she was like before she had it - why should the public pay for that? She wants it - she pays for it, or the Labour Party does, NOT the taxpayer.

How about Jacqui Smith's hubbie's Iphone, and the digital cameras she claimed for. Does Rentoul mind springing for them? Or is that something else he can't get worked up about.

Dick the Prick said...

Geez Iain - Nadine's gone and done it again.

'Is there not something slightly hypocritical about the DT increasing its revenue by an estimated £1 million per day in the name of public good?'

She really needs to get drunk, think strategically and shut up. She's sacking herself here.

The Grim Reaper said...

Have you ever undergone any media training yourself, Iain? If so, what does it consist of?

Man in a Shed said...

Let them (Labour MPs) try running a small company ....

In fact that experience would solve a lot of our current problems.

Iain Dale said...

Grim Reaper, no I haven't. I have done some media training for other people though!

karltop said...

Anonymous said...
Does the fuss over Harriet Harman's bill for media training imply that no other MP has taken any training to improve the way they do their job?

Moreover, has £10K of media training *really* improved the way that Harriet Harman does her job....?

Anonymous said...

They have no right to expect us to pay for their Accountants as well as for our own.
They have no right to assume any special status.
It is morally wrong.
They are still defending such behaviour.
Just when will they get the point ... when there is civil unrest perhaps ?

Savonarola said...

Rentoul is a journalist who has his bottom wiped with expenses and is as distant as an MP when it comes to the reality of living outside the Westminster village.

My tax return is complicated. I employ an account to do the return.

Will it be OK to tell HMR that I am deucting the fee because I employed the accountant to ensure I paid my due taxes.

Rentoul does not get it. One rule for them and another for us. I do not consent to be governed by thieves with suits who write their own rules.

I have written to HMR to ask for a ruling.

CREAMFACEDLOON said...

Rentoul is clearly out of his depth- "whereof we have no knowledge, thereof we cannot speak"; you cretinous, ignorant, oaf. What I would like to know is why, when there is prima facie evidence in the public domain of criminal offences committed by several MPs, the Met have not yet even interviewed any of the known suspects. Is it beceause there is an election next week? Answer any, Sir Paul?

Anonymous said...

There are people already who are paid by the taxpayer to tell you how much tax you owe.

You tell them about your income, gains and so forth, and (where relevant) your expenses, and they do the sums, tell you how much you owe, and you pay it. If you don't pay, they come after you.

If you make false or incomplete returns they get miffed; you might end up in Court.

If you make mistakes, you write to them and tell them and they sort it out. It's generally better to tell them about mistakes fast, because otherwise they might think ill of you.

They actually have a duty to make sure you pay the right amount - not more and not less.

They are called Tax Inspectors.

Simples.

georgeorwellslittlesister said...

Harman paid for media training?!?
What on earth was she like before?
She woz robbed.

John of Enfield said...

Not only do we have the largest tax code in the world, the most complex & one that REQUIRES you to use an accountant - in several situations the tax authorities DELIBERATELY make your situation such that you do not know in advance how you will be taxed. IR35 is one such technique. It creates confusion, uncertainty and great antagonism.

Unsworth said...

Is Rentoul thick or something? Does he not understand that the Morley and Darling cases are entirely different? And does he think that these people, who chose and designed their own tax regime (and still do so) are somehow unable to follow the 'rules' they themselves brought in? Well, they're perfectly capable of following the Green Book 'rules' apparently - even though Ed Balls thinks 'it's complicated'.

And does Rentoul think that the millions of small businesses in Britain face tax regimes which any less complex? How come so many self-employed people manage to successfully file their annual returns?

No, this is just another attempt by MPs to have us believe they are all helpless and innocent victims. How plausible is that?

Forlornehope said...

I got caught up in an HMRC campaign by our esteemed chancellor and had my tax affairs investigated. While I have got a completely clean bill of health, I still have to pay my accountant quit a substantial fee. It is not even tax deductable.

David Hughes said...

Only three points in brief :
1. You use an accountant, you pay for it.
2. The Chancellor can't figure out his tax liabilities ? What ??????
3. Harriet Dromey (nee Harman) has had Media training ? Money back guarantee, I hope - for the taxpayers' sake

Paul Halsall said...

"The rest of the world thinks"...

I can tell you this, in the US it is normal, legal, and usual to include the cost of using a tax service as a tax deduction.

Either the Telegraph is just stretching the story (after all, it doesn't really have many reporters left to do other work) or it is now scraping the barrel.

Peter said...

It seems to me logical that MPs should be paid a simple Civil Service salary plus a fixed London living allowance.

A simple straightforward system with the same rules for claiming additional expenses as Civil Servants. Administered by the same office with the same rules.

wolfie said...

Non Runner

Sorry my friend you are wrong. In order for an accountant to do your self assessment they have to be nominated by you with HMRC which means that the authorities know your accountants are doing it.Therefore you get billed for it. The best one can do is have your company pay your personal bill then add it to P11D as a benefit in kind. Whatever way you pay for it out of your already taxed income. The politicians, didn't pay for it after tax, declare it as a benefit in kind or pay tax on the cost of it.

The Half-Blood Welshman said...

I definitely think Harman should pay back the ten grand. For a start, it was obviously money wasted...

Anonymous said...

If Harriet Harman spent £11k on media training we should be recovering the money on the basis that it's made no difference whatsoever to her performances.

You know the saying -"you can't polish a turd..."