LTB 834/14 - HMRC COMPLIANCE AUDIT - UPDATE

[TrueBlueTerrier]

LTB 834/14 - HMRC COMPLIANCE AUDIT - UPDATE



No. 834/14

Ref:

Date: 23rd December 2014

To: All Branches

Dear Colleagues

HMRC COMPLIANCE AUDIT - UPDATE

Branches will recall that LTB 519/14 dated 14th August 2014 contained details of the planned meeting scheduled to take place with HMRC on 9th October 2014 in relation to the ongoing Compliance/Assurance Audit including determining the outcome of the unions application for a new dispensation and of my intention to provide further updates once any decisions/outcomes had been reached and subsequently reported to the NEC.

I can now report to branches that the union received confirmation from HMRC at the end of November 2014 that following our representations they had decided to issue a new dispensation to the CWU which now governs and regulates the way in which all personal expense (travel and subsistence) claims are paid throughout the union.

The above outcome was reported to the NEC on 18th December 2014 and the purpose of this LTB is provide branches with an initial report on how we intend to deal with this matter going forward.

CWU Dispensation

Branches will recall that prior to consideration being given to issuing the CWU with a revised dispensation HMRC required us to conduct an extensive sampling exercise. This exercise which included sampling claims from Branch, Regional and National representatives, took place during August 2014.

HMRC had previously advised the union that the information gathered during the sampling exercise would be used to establish the amounts etc that could be claimed by all union representatives and that these specific amounts would be listed and included in any new dispensation that was issued.

Following the sampling exercise we presented HMRC with all of the information at the meeting referred to above. The meeting held on the 9th October 2014 was attended by CWU Trustees, Joe Malone and Karen Rose, advisors from CVDFK, Peter Metcalfe and me with representatives from HMRC, Debbie Patterson and Michael Appleby in attendance.

As reported above the main conclusion coming out of the meeting is that HMRC have now issued a new dispensation.

The revised dispensation contains the amounts that ALL representatives are entitled to claim and it is these amounts that once introduced will govern our policies and procedures going forward.

The new amounts are as follows; there will be one standard overnight rate throughout the UK and the amount that can be claimed has been increased to £140.00p. We have been successful in maintaining all our current day rates which dependent on time spent away from home are £15.00p £10.00p and £7.50p respectively. In respect of conferences we have also secured an agreement which maintains that in addition to the standard rate of £140 that an additional £70 can also be claimed.

Most importantly the dispensation sets out precisely what these rates cover in terms of accommodation and meals and makes the point that these have to be actual expenses incurred and be receipted, therefore the receipt has to show what has actually been incurred in order that we can satisfy the terms of the dispensation.

This dispensation and its application will now form the basis for the need to issue revised mandatory personal expense policies throughout the union. We need to do this to ensure that we remain compliant going forward and be able to prove to any future HMRC audit (a fact that is inevitable in my view) that only actually incurred receipted expenses, as per the dispensation, claimed for the reasons laid out are paid by the CWU. Failure to do anything else will result in the dispensation being revoked.

It cannot be overly emphasised that now a formal dispensation has been issued we will need to comply with it in order that we provide protection, not just for the organisation but more importantly for each and every representative of the Union.


Next Steps



The above information sets out the position that we have now reached in relation to the HMRC Assurance Audit which, as a reminder, began with a letter from HMRC in May 2011 and appears to have been going on for what feels like a lifetime.

I know that everyone in the union will appreciate and agree that the issues that we have had to deal with during this time have been very difficult and at times challenging for us all.

Our next task is to start to put some clear blue water between us and HMRC and the first stage in this process will be by agreeing and introducing revised policies and guidelines etc that negate any risk that we end up in this position again at any point in the future.

With this in mind we will be setting up a consultative group consisting of the CWU National Trustees, CWU (lay) National Auditors and Regional and Branch Representatives plus administrative support from my department.

Please note that further information regarding the Branch and Regional membership of the consultative group will be issued early in the New Year.

The primary task of the working group will be to review all of our current personal expense policies and guidance documents to ensure they are fit for purpose and more importantly are HMRC compliant. We would then produce a comprehensive personal expense policy booklet for use by everyone throughout the union.

In addition to the consultative group discussions we would also wish to invite comments/contributions etc from any Branches/Regions or Senior Field Officials etc regarding the review of the union's personal expense policies.

We will also be arranging a series of briefings (and/or workshops) for Branch, Regional and Senior Field Representatives to take place during March 2015 to explain how the new procedures, once drawn up, will operate.

As I indicated at the start of this LTB this is my initial report to Branches and mainly covers the developments regarding the important issue of the dispensation. However there are still a number of other areas under discussion with HMRC which we are looking to conclude in early 2015 and it is my intention to produce further reports over the coming months covering these areas.

Any enquiries regarding this LTB should in the first instance be forwarded to Tony Kearns, Senior Deputy General Secretary.

Yours sincerely,

Tony Kearns
Senior Deputy General Secretary.

[dvbuk55]

As opposed to being self effacing it appears to be quite a lucrative pastime representing the members. No wonder they're falling all over themselves to get elected