Platforms have questioned how plans to allow HM Revenue & Customs to recover debts from stocks and shares Isas will work in practice.
In the Budget, the Government proposed allowing HMRC to recover tax owed directly from debtors’ bank accounts. Last week, HMRC published a consultation on the subject and said the power should be extended to Isas. An HMRC spokesman has told Money Marketing this will include stocks and shares Isas.
Skandia technical specialist Gordon Andrews says: “It is right for HMRC to be empowered to hold individuals accountable for the taxes they owe but any proposal to recover debts from stocks and shares Isas needs to be very carefully considered. For example, who would be responsible for determining which assets to liquidate to cover the debt?”
GBST wealth management chief executive Rob DeDominicis says: “These changes must be considered in the wider context of massive proposition change requirements.
“GBST will be responding to the consultation on how to meet these proposals in a way that is affordable, achievable and adaptable to further changes.”
Technology provider Bravura, whose clients include Nucleus, Aviva and Ascentric says debt recovery from stocks and shares will add an extra layer of administration.
Bravura head of regulatory change Andrew Palmer says: “The consultation is new so we will need to see how it plays out. But if volumes are low then administratively it could be done manually. If volumes are higher then administrators may need workflows to be enhanced or systems to be updated.”