Understanding Form COMP1: Temporary Authorisation for Compliance Checks
- Adil Akhtar
- Jul 24, 2023
- 10 min read
Updated: Feb 23, 2024
Form COMP1 is a document used in the United Kingdom by HM Revenue and Customs (HMRC) to facilitate temporary authorisation for tax agents or advisers to deal with HMRC on their client's behalf specifically for compliance checks. This form is particularly useful when the tax agent or adviser does not have permanent formal authorisation.
Purpose of Form COMP1
Form COMP1 provides written consent for HMRC to exchange and disclose information relevant to the compliance check with the named adviser. It relates only to the compliance check of the period(s) that you enter on this form and covers all matters administered by HMRC that are being checked. This temporary authorisation does not cancel or amend any permanent authorisation that you have already sent to HMRC.
When to Use Form COMP1
If a tax agent or adviser already has permanent formal authorisation set up for their client, they don't need separate temporary authorisation to deal with HMRC compliance checks. However, if they don't have formal authorisation and HMRC is carrying out compliance checks on their client, they can apply for temporary authorisation to deal with HMRC for these checks only.
How to Use Form COMP1
To arrange temporary authorisation, the client must complete a form COMP1. The completed form should be sent to the HMRC officer who is dealing with the check. It's important to note that only HMRC staff who are working on the compliance check will know about the temporary authorisation. If the tax agent or adviser needs to deal with HMRC on the client’s behalf for anything else, they'll need to arrange for permanent formal authorisation.
Form COMP1 is a valuable tool for tax agents and advisers, allowing them to assist their clients with HMRC compliance checks even if they don't have permanent formal authorisation. By understanding what Form COMP1 is and how to use it, tax agents and advisers can better serve their clients and ensure compliance with HMRC regulations.
Key Reasons to Authorise a Tax Advisor to Deal with HMRC Using Form COMP1
Form COMP1 is a document used by HM Revenue and Customs (HMRC) in the United Kingdom to facilitate temporary authorisation for tax agents or advisers to deal with HMRC on their client's behalf specifically for compliance checks. Authorising a tax advisor to deal with HMRC using form COMP1 can have several advantages. This article explores the main reasons for doing so.
Expertise in Tax Matters
Tax advisors have specialised knowledge and experience in dealing with tax matters. They understand the intricacies of tax laws and HMRC procedures, which can be complex and difficult for individuals and businesses to navigate. By authorising a tax advisor to deal with HMRC, you can leverage their expertise to ensure that your tax affairs are handled correctly and efficiently.
Time and Effort Saving
Dealing with HMRC can be time-consuming, especially when it involves compliance checks. By authorising a tax advisor to handle these matters, you can save significant time and effort. The tax advisor can handle all communications with HMRC, prepare and submit necessary documents, and follow up on any issues, allowing you to focus on your core business or personal activities.
Avoiding Errors and Penalties
Mistakes in dealing with tax matters can lead to penalties and additional tax liabilities. A tax advisor can help avoid such errors by ensuring that all information provided to HMRC is accurate and complete. They can also help ensure that all deadlines are met, avoiding late submission penalties.
Navigating Complex Situations
In some cases, dealing with HMRC can involve complex situations, such as disputes over tax liabilities or investigations into tax affairs. A tax advisor can provide valuable assistance in these situations, helping to negotiate with HMRC, challenge their decisions if necessary, and ensure that your rights are protected.
Peace of Mind
Perhaps one of the most significant benefits of authorising a tax advisor to deal with HMRC is the peace of mind it provides. Knowing that a professional is handling your tax affairs can alleviate stress and uncertainty. You can be confident that your tax matters are being managed effectively and in your best interest.
Authorising a tax advisor to deal with HMRC using form COMP1 can offer several benefits, from leveraging their expertise in tax matters to saving time and effort, avoiding errors and penalties, navigating complex situations, and providing peace of mind. Whether you're an individual or a business, considering this option can be a wise decision when dealing with HMRC compliance checks.
Understanding Form COMP1a and Its Distinction from COMP1
Form COMP1a is a crucial document used by tax agents in the United Kingdom. It's used to authorise the HM Revenue and Customs (HMRC) to deal directly with a tax agent about a disclosure made using the Digital Disclosure Service. This form is particularly useful when a client is making a voluntary disclosure to HMRC.
The Role of Form COMP1a in Voluntary Disclosures
When a taxpayer realises they have not paid the correct amount of tax, HMRC encourages them to make a voluntary disclosure. This process involves notifying HMRC about the intention to make a disclosure, disclosing all income, gains, tax and duties not previously reported, making a formal offer, paying what is owed, and providing additional information if requested.
Form COMP1a comes into play when a tax agent is involved in this process. The client can use this form to allow HMRC to deal directly with the tax agent about the disclosure. This can simplify the process for the client and ensure that all communications are handled by a professional who understands the intricacies of tax law and HMRC procedures.
The Difference Between Form COMP1a and COMP1
While both forms COMP1 and COMP1a are used in the context of compliance checks and disclosures, they serve different purposes. Form COMP1 is used to grant temporary authorisation for a tax adviser to act on behalf of a client during a compliance check. This form is used when HMRC is conducting an investigation into a taxpayer's affairs.
On the other hand, form COMP1a is used specifically for voluntary disclosures made using the Digital Disclosure Service. It allows a tax adviser to handle all communications with HMRC regarding the disclosure. It's important to note that each form has its specific use and should be used in the appropriate circumstances.
Understanding the difference between form COMP1 and COMP1a is crucial for taxpayers and tax advisers alike. While both forms are used to authorise a tax adviser to act on behalf of a client, they are used in different contexts. Form COMP1 is used during compliance checks, while form COMP1a is used for voluntary disclosures. By using the correct form in the appropriate situation, taxpayers can ensure that their affairs are handled efficiently and professionally.
How to Make a Voluntary Disclosure to HMRC and the Role of Form COMP1a
The HMRC (Her Majesty's Revenue and Customs) believes that customers want to pay the correct amount of tax. If you think you have not paid the correct amount of tax, HMRC wants to help you rectify that. It doesn't matter why your tax affairs are wrong. It’s better to contact HMRC and admit any failures or errors rather than face a potential criminal investigation in serious cases of undisclosed tax or income.
Different Ways to Make a Disclosure
There are three different ways you can make a disclosure to HMRC:
The Contractual Disclosure Facility (CDF): Use the CDF if your deliberate behaviour has caused a loss to HMRC of any of the taxes, duties, levies or payments they administer.
The Coronavirus Job Retention Scheme Grant Repayments: Use the online service if you’re an employer who overclaimed Coronavirus Job Retention Scheme grants and wants to pay them back.
The Digital Disclosure Service: Use this service if you’re an individual or company and want to make a disclosure about Income Tax, Capital Gains Tax, Inheritance Tax, Corporation Tax, National Insurance contributions, or Annual Tax for Enveloped Dwellings (ATED).
The Role of Form COMP1a
Your client can use form COMP1a to allow HMRC to deal directly with you about a disclosure made using the Digital Disclosure Service. This form is particularly useful for tax advisers or personal representatives making a disclosure on behalf of someone else.
How to Make a Disclosure Using the Digital Disclosure Service
The process of making a disclosure using the Digital Disclosure Service involves several steps:
Notify HMRC: You must tell HMRC that you intend to make a disclosure as soon as you know that you owe tax.
Disclose: You can disclose as soon as you have your disclosure reference number. But you must disclose within 90 days of the date that HMRC acknowledges your notification.
Make a Formal Offer: This involves proposing to HMRC how you intend to rectify your tax affairs.
Pay What You Owe: When you submit your disclosure, you must pay what you owe using the payment reference number.
Provide Additional Information if Requested: Help HMRC as much as you can if they ask you for more information.
Making a voluntary disclosure to HMRC is a serious matter and should be handled with care. It's always advisable to seek professional advice if you're unsure about any aspect of the process. The use of form COMP1a can facilitate the process, especially when a tax adviser is making the disclosure on behalf of a client.
How Pro Tax Accountant Can Assist as Your Authorised Tax Agents in the UK and Help with Form COMP1a and COMP1
Pro Tax Accountant, recognised as the No. 1 online Tax Accountant in the UK, offers a comprehensive range of services to help individuals and businesses manage their tax affairs effectively. As authorised tax agents, they can act on your behalf in dealing with HM Revenue and Customs (HMRC), including helping with form COMP1a and COMP1. Here's how they can assist you.
Acting as Your Authorised Tax Agents
As your authorised tax agent, Pro Tax Accountant can handle all your tax-related matters with HMRC. This includes preparing and submitting tax returns, dealing with tax compliance checks, and liaising with HMRC on any tax disputes. They can provide expert advice on tax planning and help you minimise your tax liability within the legal framework.
Assistance with Form COMP1
Form COMP1 is used to grant temporary authorisation for a tax adviser to act on behalf of a client during a compliance check by HMRC. If HMRC is conducting an investigation into your tax affairs, Pro Tax Accountant can help you fill out and submit form COMP1. This allows them to deal directly with HMRC during the compliance check, ensuring that all communications are handled professionally and efficiently.
Guidance on Form COMP1a
Form COMP1a is used specifically for voluntary disclosures made using the Digital Disclosure Service. If you need to make a voluntary disclosure to HMRC, Pro Tax Accountant can guide you through the process. They can help you fill out and submit form COMP1a, which allows them to handle all communications with HMRC regarding the disclosure. This can simplify the process for you and ensure that all aspects of the disclosure are handled correctly.
Expertise and Experience
Pro Tax Accountant brings a wealth of expertise and experience to the table. Their team of qualified tax accountants understands the intricacies of UK tax law and HMRC procedures. They can provide valuable insights and advice to help you navigate the complex world of tax compliance. Whether you're dealing with a compliance check, making a voluntary disclosure, or just need help with your tax returns, Pro Tax Accountant can provide the expert assistance you need.
Managing your tax affairs can be a complex and daunting task. But with Pro Tax Accountant as your authorised tax agent, you can rest easy knowing that your tax matters are in capable hands. Whether you need help with form COMP1 during a compliance check or form COMP1a for voluntary disclosure, Pro Tax Accountant can provide the expert assistance you need. Their commitment to professionalism, expertise, and client satisfaction makes them the No. 1 choice for online tax accountancy in the UK.
FAQs
1. Q: What is the validity period of a temporary authorization granted by Form COMP1?
A: The validity of temporary authorization through Form COMP1 is tied to the duration of the compliance check for which it is granted and does not extend beyond it.
2. Q: Can Form COMP1 be used for authorizing representation in tax matters beyond HMRC compliance checks?
A: No, Form COMP1 is specifically for temporary authorization during HMRC compliance checks. Permanent formal authorization is required for other tax matters.
3. Q: What happens if the compliance check extends beyond the initially expected duration?
A: If the compliance check extends, the temporary authorization under Form COMP1 continues until the check is concluded.
4. Q: Is there a digital version of Form COMP1 available for online submission?
A: The availability of a digital version for online submission would depend on HMRC's current processes, which are subject to change.
5. Q: Can multiple tax agents be authorized using a single Form COMP1?
A: Typically, Form COMP1 is used to authorize a single tax agent or adviser, but specific arrangements can be discussed with HMRC.
6. Q: How quickly does HMRC process a submitted Form COMP1?
A: Processing times can vary based on HMRC's workload and specific circumstances of the compliance check.
7. Q: What are the consequences of not using Form COMP1 when required?
A: Failure to properly authorize a tax agent for a compliance check can lead to delays and complications in the process.
8. Q: Can Form COMP1 authorization be revoked before the end of a compliance check?
A: Yes, the taxpayer can revoke the authorization by informing HMRC, but this should be done with careful consideration.
9. Q: Are there any fees associated with submitting Form COMP1?
A: Typically, there are no fees for submitting Form COMP1, but consulting with a tax adviser may incur costs.
10. Q: What specific information is required to complete Form COMP1?
A: Detailed personal and tax-related information of the taxpayer, as well as specifics about the compliance check and the authorized agent.
11. Q: Can Form COMP1 be used to authorize representation for a company?
A: Yes, Form COMP1 can be used for both individuals and companies undergoing a compliance check.
12. Q: What is the process for resolving disputes regarding the authorization given through Form COMP1?
A: Disputes or concerns should be addressed directly with HMRC, with the possibility of involving the tax agent or adviser as necessary.
13. Q: How does Form COMP1 affect existing permanent authorizations?
A: Temporary authorization through Form COMP1 does not cancel or amend any existing permanent authorizations.
14. Q: Can a tax adviser initiate a Form COMP1 authorization on behalf of a client?
A: While a tax adviser can assist, the client must provide explicit consent for the Form COMP1 authorization.
15. Q: Is it possible to extend the scope of Form COMP1 authorization beyond the specified compliance check?
A: No, the authorization is strictly limited to the duration and scope of the specified compliance check.
16. Q: How does HMRC communicate with the authorized tax agent under Form COMP1?
A: HMRC communicates directly with the authorized agent regarding the compliance check, using the contact details provided in the form.
17. Q: Can Form COMP1 authorization be transferred to another tax agent or adviser?
A: Authorization cannot be transferred. A new Form COMP1 would need to be submitted to authorize a different agent.
18. Q: What documentation is needed to support a Form COMP1 submission?
A: Supporting documentation may include identification and proof of the tax agent's right to act, but specifics should be confirmed with HMRC.
19. Q: How is Form COMP1 different from other HMRC authorization forms?
A: Form COMP1 is specifically for temporary authorization during compliance checks, unlike other forms designed for broader or permanent authorizations.
A: The individual or the tax agent should immediately contact HMRC to correct any inaccuracies in the form to ensure that the authorization accurately reflects the intended scope and duration of representation.
.png)