On the 26 June, professionals across the country received an email from HMRC that stated due to the relaxation in restrictions across the UK, the number of accounts submitted by post was reverting to the usual volumes. It was therefore recommended that all customers who were able to use the postal system to file IHT accounts, should do so.
This appeared to be a change from the advice in the Trusts and Estates Newsletter updated only days before. The newsletter, updated on the 22 June, had stated that requests from agents to submit accounts electronically could be done through a trial of Dropbox and that agents should request via email. It was not mentioned that the electronic submission would be for exceptional cases only, however, within days this had changed to:
“we will only be issuing a link to the Dropbox facility upon request and by exception, where that request outlines why a specific account cannot be submitted by post.”
This change has gathered opinions from many in the industry as a step backward for HMRC. Martin Langan, MD at Legal Workflow stated on LinkedIn:
“I see that HMRC have announced that as postal volumes are returning to normal, they have withdrawn their electronic submission facility for IHT forms and require wet signatures again unless in exceptional circumstances. Dreadful lost opportunity to take advantage of the innovation that had arisen out of adversity. So disappointing. “
In the June Newsletter, if personal representatives or trustees were experiencing difficulties in signing IHT forms, as a result of social distancing, returns would “temporarily” be accepted from professionals without wet signatures, providing certain circumstances were met.
The pandemic has shown that moves forward in using technology not only increased security but also decrease the amount of work and paper needed for certain tasks, yet now that lockdown is being eased, these options are also being removed. To many this does not make sense and feel that the use of technology and “going digital” should remain.
Elizabeth Neale, Partner at BDB Pitmans, comments:
“If the security and privacy concerns can be addressed and HMRC have appropriate case management systems in place, then this online submission would hopefully enable HMRC to determine which estates require closer analysis and ensure that the relevant information reaches the right team in a timely manner. At the moment, valuations have to be resubmitted to the Valuation Offices or Share & Assets valuation team because the IHT team are not always in a position to send them on in a format the relevant team can work with.”
Hugo Smith, Partner at BDB Pitmans, comments:
“The ability to file IHT forms online is a positive response from HMRC to the difficulties caused by Covid-19 and lockdown. It will reduce the amount of paperwork practitioners have to deal with, particularly where the form includes bulky valuations. Before this is widely adopted, though, practitioners will need to be confident about the security and privacy implications of submitting confidential information via an online resource in this way.”