The Council for Licensed Conveyancers has written to the Treasury urging it to reconsider its stance on requiring conveyancers to register as tax advisers.
In a letter to James Murray, chief secretary to the Treasury, CLC chair Dame Janet Paraskeva said the organisation is “disappointed that it still seems to be the intention to require conveyancers to register as tax advisers individually with HMRC.”
The move will duplicate regulatory effort and increase the burden on conveyancers, Dame Paraskeva added, when there have been no significant issues in relation to compliance with tax law and no case has been made to justify the change.
Pointing out that CLC-regulated conveyancers are not permitted to give tax advice to clients, Dame Paraskeva said the registration requirement “would have the perverse effect of creating the impression that CLC conveyancers may provide tax advice.”
She added:
“This actually increases the risk of wrongdoing, by giving bad actors an opportunity to present themselves as tax advisers in a way that they cannot at present.
“Conveyancers, especially those regulated by the CLC, are already tightly regulated. That includes in relation to every type of advice they provide to their clients as well as how they handle client money and meet obligations to HMRC and Land Registry as part of the property transaction process. This regulatory monitoring and oversight includes ensuring that tax advice is not offered.”
The CLC has closed down practices that have been involved in SDLT avoidance schemes, along with those which have not made the necessary payments to HMRC, Dame Paraskeva said. However, the instances of error or fraud are so few they do not warrant the additional and “unnecessary burden,” which will increase costs to both clients and taxpayers without reducing risk, she added.
HMRC has produced no evidence that CLC licensed conveyancers pose any risk, Dame Paraskeva said, and any issues related to SDLT calculation and payment are already managed by the CLC.
The increase in the regulatory burden should also be viewed alongside the “unwelcome decision” to move anti-money laundering supervision away from the Solicitors Regulation Authority to the Financial Conduct Authority, Dame Paraskeva added.
“This tool will inevitable duplicate effort and cost with no analysis pointing to reductions in money laundering as a result.”
Dame Paraskeva concluded:
“I hope that Treasury Ministers will be able to consider again whether the registration of specialist conveyancers with HMRC as tax advisers is proportionate to the risks Ministers seek to address and whether the outcome will indeed be beneficial to the country as we strive to deliver growth.”
