How HMRC’s new ‘sanctionable conduct’ powers could impact conveyancers
Summary
HMRC has introduced a broader sanctionable conduct regime that can penalise tax advisers who intentionally facilitate tax underpayment and can also compel production of files where there are reasonable grounds to suspect misconduct. The article focuses on how this affects conveyancers handling SDLT work, emphasising the importance of contemporaneous records, clear reasoning and client approval trails.
Why it matters
Residential conveyancers often advise on SDLT treatment, calculate tax and submit returns, which may bring them within HMRC’s wider definition of tax adviser. Robust file management and defensible audit trails are increasingly important because HMRC can review working papers before proving wrongdoing.
Key points
- HMRC can penalise intentional tax-facilitation conduct with fines from £7,500 to £1 million.
- HMRC may access advisers’ files on reasonable suspicion, before proving sanctionable conduct.
- The regime targets deliberate dishonesty, not genuine mistakes.
- SDLT advice, calculations and return submissions can fall within the scope of tax adviser activity.
- Contemporaneous records, client questionnaires, decision notes and approval procedures can help defend SDLT positions.
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