Chapter 2 (PRPG) - Fundamental Principles And Members Obligations Flashcards
2.1 Overview of the Fundamental Principles
Integrity – to be straightforward and honest in all professional and business relationships.
Objectivity – to not allow bias, conflict of interest or undue influence of others to override professional or business judgements
Professional competence and due care – maintain professional knowledge and skill at the level required to ensure that a client or employer receives competent professional service based on current developments in practice, legislation, techniques and acts diligently and in accordance with applicable technical and professional standards
Confidentiality – respect the confidentiality of information acquired as a result of business relationships and not to disclose this with third parties without proper authority, unless there is a legal or professional right to disclose, or to use the information for the personal advantage of a member or third parties.
Professional behaviour – to comply with relevant laws and regulations and avoid any action that discredits the profession.
In addition to the fundamental principles a member must comply with PRPG which provides detailed guidance on the relationship between a member, their client and HMRC.
2.2 Integrity
A member must always be honest in their professional work, a member must not knowingly supply information or make any statement which is false or misleading, nor knowingly fail to provide relevant information. A member must not engage in or be party to any illegal activity. A member must ensure clients money is properly accounted for and maintained separately. Must not obtain to seek professional work in any unprofessional manner.
2.3 Objectivity
A member must be objective in all work. If objectivity is impaired through conflict of interest, a member must act in accordance with Chapter 6.
2.4 professional competence and due care
Must carry out work with regard for the technical and professional standards expected. A member must not do professional work where the member is not competent to perform, whether its due to a lack of experience or lack of technical skills, unless appropriate advice, training or assistance is obtained to ensure the work is completed correctly.
2.5 confidentiality
A member owes a duty of confidentiality to their client or employer, this applies without a time limit. This includes information brought to their knowledge during or after carrying out their assignment. The same duty of confidentiality should be imposed on employees and subcontractors. Information acquired must not be divulged in any way outside their organisation without specific consent. Members must comply with the legal requirement on the handling of data.
2.6 professional behaviour
A member owes a duty of confidentiality to their client or employer, this applies without a time limit. This includes information brought to their knowledge during or after carrying out their assignment. The same duty of confidentiality should be imposed on employees and subcontractors. Information acquired must not be divulged in any way outside their organisation without specific consent. Members must comply with the legal requirement on the handling of data.
2.7 professional indemnity insurance and personal responsibility
A member in practice must protect their clients, their practice and themselves by having PII cover that complies with CIOT/ATT PII regulations. A member is responsible for their own work and that of their employees and subcontractors. A member may be liable to pay damages for loss caused by their own professional negligence and that of their employees and subcontractors.
2.8 completion of annual return
A member must complete and submit their annual return to the CIOT/ATT within the advised time limits (time limits not given in the guidance).
2.9 compliance with professional conduct in tax
A member must conduct their tax work in accordance with PCRT
2.10 compliance with AML legislation and registration
A member must comply with the UK’s AML legislation in force from time to time. A member must act in accordance with the Anti-Money Laundering Guidance for the Accountancy Senior (AMLGAS) anti money laundering guidance including the appendix for tax practitioners.
A member in practice must either be registered with the CIOT/ATT for AML supervision or, if requested, advice the CIOT or ATT of their Supervisory Authority under the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017.
2.11 compliance with continuing professional development (CPD)
It is important that a member keeps up to date in relation to statute and case law and practice in areas where a member holds themselves out to be competent to practice. The CPD rules do not apply to students of the CIOT/ATT who are not members of either body. A compulsory CPD scheme applies to all CIOT and ATT members with some minor exceptions. Current guidelines are on the ATT/CIOT website.
2.12 provision of information to CIOT/ATT
A member must provide information as reasonably requested by the CIOT and ATT without unreasonable delay. A member must reply to correspondence from the CIOT/ ATT which requires a response and without unreasonable delay.
2.13 compliance with disciplinary process and orders from the TDB
A member is subject to the disciplinary processes of the TDB and must comply with any order from the TDB including orders in respect of costs and fines. A member must respond to correspondence from the TSD without unreasonable delay, which means 30 days except in special circumstances. Failure to respond to correspondence or comply with an order from the TDB will constitute a disciplinary matter.
2.14 obligation to notify CIOT/ATT
A member must inform the CIOT or ATT in writing addressed to the Head of Professional Standards within 2 months if they are arrested on suspicion of; or charged with; or convicted of a criminal offence (other than a summary only road traffic offence). A criminal offence includes an offence committed in the UK or abroad. A member must supply details of the nature of the allegation or conviction and provide relevant information in relation to it as reasonably requested. Ordinarily, CIOT/ATT will not refer a member to the TDB until the outcome of the criminal proceedings.
A member must notify CIOT/ATT in writing addressed to the Head of Professional Standards within 2 months if they are:
• Notified of disciplinary and/or regulatory action upheld against them by another professional body to which the member belongs to
• Are dismissed for misconduct/gross misconduct by their employer
• Are disqualified as a director or trustee, or enter into a disqualification undertaking
• Receive a dishonest tax agent conduct notice
• Receive a monitoring notice from HMRC under the Promoters of Tax Avoidance Schemes (POTAS) legislation
2.15 bankruptcy and individual voluntary arrangements
A member who enters into an IVA or bankruptcy must notify the CIOT/ATT within 2 months of the order. If a member fails to notify their membership shall cease automatically upon the expiry of the 2-month period. The CIOT/ATT reserves the right to reverse the cessation of the membership on the matter coming to their knowledge. Where a member does notify within 2 months, the CIOT/ATT will consider appropriate action which includes continuation of membership, referral to TDB and exclusion. The CIOT/ATT will make their decision within 2 months of being notified or the member will be notified that their case is being considered. A member can appeal termination of membership to the TDB, the appeal must be made within 31 days of the notification of exclusion.
