The accountancy profession has reacted angrily to the publication last week of Law Society guidance on the extent of solicitors' disclosure obligations under the new tax avoidance disclosure regime, claiming Chancery Lane's approach means there will not be 'a level playing field' between different professional advisers.


The Society said that, in most cases, solicitors could rely on legal professional privilege and would therefore not be forced to disclose the information required by the Finance Act 2004 (see [2004] Gazette, 23 September, 1).



Inland Revenue: start date stays
But in a letter to the Chancellor of the Exchequer, Gordon Brown, the Consultative Committee of Accountancy Bodies (CCAB) wrote to express its 'extreme concern' that the rules might hand the legal profession 'an unfair advantage'.


The CCAB - which comprises the UK's six main accountancy bodies - backed the Inland Revenue's view that legal professional privilege does not prevent lawyers from applying the new rules in the same way as accountants and other advisers.


It warned that test case litigation involving the Revenue and the Law Society to resolve the issue 'could take years to achieve' and called on the Chancellor to take urgent action.


Asking for the start date for disclosure - 30 September - to be deferred, the CCAB added: 'The impasse appears to us to be wholly unsatisfactory. We think that the government must amend the legislation now to put beyond doubt that the tax disclosure rules apply equally to lawyers as to any other advisers.'


A spokeswoman for the Inland Revenue said there are no plans to change the start date. She added: 'The regulations do not require disclosure of privileged information and so do not in any way interfere with the relationship between adviser and client.'


The Law Society declined to comment on the CCAB's letter.