Tax Agent Research Articles

Developments in tax e‐filing: practical views from the coalface

PurposeElectronic filing (e‐filing) of personal tax returns has become a global trend in developed countries. An increasing number of individual UK taxpayers are seeking help from tax advisers as ambitious e‐filing targets increase the interaction between taxpayers, tax agents and government departments. This article aims to review the attitudes to information and communications technology (ICT) adoption between these three groups.Design/methodology/approachThis article has partly built on the work of Walsh and White, who use Moore's “Technology Adoption Life Cycle” to examine e‐filing adoption by taxpayers and tax preparers in the USA. However, this article uses a mixed methodology that the authors argue is more suitable for the wider issues found in the UK.FindingsThe results confirm that small/medium sized tax agent firms are more likely to be technology enthusiasts/early adopters of e‐filing for their individual clients. As their business policies are more likely to be directly driven by technology enthusiasts, they have fewer issues with the incomplete e‐filing system available at the early stages of its roll out and were more motivated by the visible benefits available from adopting e‐filing. Larger firms have been slower and appeared more reluctant to embrace e‐filing of personal tax returns being concerned that engaging in HM Revenue and Customs controlled systems and targets would compromise their internal systems, ICT integrity and control of complex tax cases.Practical implicationsThis split in e‐filing attitudes by tax agents supports Moore's “chasm” argument for technology adoption processes, implying solutions for widening participation found appropriate for other domains could be equally applicable in this domain. The article reflects on these findings and proposes practical solutions that build on prior research to assist the government in achieving the future ambitious targets for e‐filing.Originality/valueThis paper reports the results of a national survey of tax advisers, supported by follow‐up interviews, addressing the development of e‐filing for personal taxation in the UK.

A Study on the Influence of Tax Agent's ability or activity and Taxpayers' situation factor on client's satisfaction of Tax Agents' Service

A Study on the Influence of Tax Agent's ability or activity and Taxpayers' situation factor on client's satisfaction of Tax Agents' Service

Equipping the Australian Public Service for Australia's Future Challenges

Equipping the Australian Public Service for Australia's Future Challenges

납세자와 세무대리인의 조세인식 분석

To examine whether there are any differences between the consciousness of a taxpayer and that of a tax agent, this study has been analyzed and performed by using the questionaire. The results of the analysis show that there are some differences in variable of analytical objects in the tax consciousness of a taxpayer and a tax agent. The political alternative to settle the difference in the tax consciousness of a taxpayer and a tax agent and increase the fairness of tax education and system.

The impact of audit risk, materiality and severity on ethical decision making

PurposeThe purpose of this paper is to focus on the role of the tax agent as a preparer of tax returns and provider of professional tax advice under a system based on self‐assessment principles. It recognises the competing pressures under which tax agents attempt to discharge their professional responsibilities, and examines the implications for potentially unethical behaviour.Design/methodology/approachThe paper uses a mail survey of tax professionals in Western Australia. Respondents are presented with realistic tax return scenarios, in which the demands of the client are varied according to the risk of audit, the severity of tax law and the materiality of dollar amounts involved.FindingsThe findings suggest that the severity of tax law violation is an important factor in ethical decision‐making, but that audit risk and the amounts involved are not.Research limitations/implicationsThe lack of support for audit risk as an influential variable is an important outcome, because policy makers have traditionally proceeded on the basis that increases in audit probabilities will reduce the likelihood of taxpayers adopting aggressive tax reporting positions. However, since the findings are based on an Australian sample, care must be taken in generalizing these findings elsewhere.Practical implicationsThe implications are important in that alternative enforcement and compliance strategies must be considered by tax administrators.Originality/valueThe paper extends empirical research into taxpayer attitudes to those of the preparers of tax returns. The findings will be of relevance both to tax agents and to tax administrators.

Aggressive tax planning: Differentiating those playing the game from those who don't

The study reported in this paper examined a group of Australian taxpayers who have expressed a preference for a creative and aggressive tax agent. The study attempted to understand how high-risk taxpayers and high-risk practitioners form their partnerships by examining aggressive taxpayers' attitudes and perceptions of the Australian tax system. Data were taken from 2040 Australian taxpayers who had responded to a national survey on tax issues. Results from a series of independent sample t-tests revealed that there are a number of important differences between `aggressive' and `non-aggressive' taxpayers. Finally, a logistic regression analysis was used to determine which variables most effectively differentiated aggressive taxpayers from non-aggressive taxpayers. The findings are discussed in a regulatory context and possible solutions for how tax authorities might deal with this high-risk group of taxpayer are suggested.

Valuation of Non-U.S. Oil and Gas Properties

This paper (SPE 60223) was revised for publication from paper 52957, originally presented at the 1999 SPE Hydrocarbon Economics and Evaluation Symposium held in Dallas, 20–23 March. Original manuscript received 1 February 1999. This paper has not been peer reviewed. Summary Valuation of non-U.S. concessions, prospects, and producing fields varies greatly from country to country because of differences in fiscal and political regimes and therefore must include quantified adjustments for these differences in the light of comparative modes of sale of other non-U.S. properties. The market for acquisitions and divestitures works by also applying such adjustments to the values derived for U.S. analogs with comparable geological, engineering, and economic risks. This paper discusses the primary types of fiscal regimes found around the world, namely, licenses with royalties and taxes, association agreements, and production-sharing contracts (PSC's). We show that discounted-cash-flow (DCF) models are readily applicable to proved reserves and present a review of a recent market transaction to demonstrate these effects. Political risk in the non-U.S. market is shown to be additive. Introduction For most of the 20th Century, non-U.S. oil business was the exclusive domain of industry majors. Over the last few decades, however, numerous small companies and independents have become increasingly global, which, in turn, increases the need to understand the approaches to valuing their non-U.S. properties. Takings or expropriations are experienced where values may need to be estimated by courts or tribunals. Other instances requiring a valuation include potentially taxable transactions, such as transferring an oil or gas property across country boundaries. Sales transactions frequently take place between apparently willing and knowledgeable buyers and sellers, so the concept of fair market value should apply. This all sounds familiar to the U.S. oilman, banker, or tax agent. However, can the same approaches to estimates of fair market value be used globally? Are there differences or pitfalls that would be important to consider when appraising non-U.S. properties? This paper shows that a resounding "yes" is the answer to both questions. It also highlights some of our own experiences in the non-U.S. appraisal arena. U.S. Approaches Numerous presentations have been made on the merits of conventional approaches, such as the DCF methods and comparable sales with various unit values. In addition, cost methods have seen use, particularly in the downstream sector. This paper examines the ease or difficulty with which these familiar methods can be applied worldwide. A brief review of the most common U.S. method, the DCF approach is presented first, followed by an alternative interpretation of the discount rate applied by the market. DCF Approach. The DCF method is best applied to producing properties or to properties where the outlook for an income stream in the near future is likely and not speculative. Simplistically, the multistep approach of valuation consists of an annual forecast of oil and gas production volumes times a prediction of prices less an estimate of operating costs. After other, but minor, adjustments, this future cash flow is discounted for both time value of money and the perceived probability of achieving exactly the predicted cash flow. Miller and Vasquez1 present arguments for their observed 6 to 8% excess of the average market discount rate over the average cost of capital. The excess is sometimes considered equivalent to growth motive, offsetting the "risk" of the oil business. It reflects the desire on the part of owners or management to make a rate of return better than the company's weighted average cost of capital (WACC). Can this 6 to 8% excess be dissected further, and can it be quantified? Most importantly, can such an understanding improve the selection of discount rates to be applied in the valuation of non-U.S. properties? Key Variables. We examine the oil operating company's perception of the probability that it will actually receive the predicted cash flow when purchasing a producing property. If the company were 100% sure of the cash flow as predicted by the reserve engineer, it might pay close to its cost of capital. Conversely, if an operating company were uncertain, it would pay less and target a higher rate of return. Prediction of the DCF rate of return is based on four major parameters: production quantities, oil prices, operating costs, and discount rate. Production quantities may vary from the petroleum engineer's predictions, oil prices will fluctuate, and operating costs may likewise turn out differently than forecast. In addition, the discount rate generally used to reflect time value of money—namely, the weighted average cost of capital (WACC) for the E&P industry sector—varies with the country's economy. U.S. appraisal experience and literature provide a framework for estimates of these four parameters. Quantity, Price, and Operating Cost. The first three parameters have been used for prediction for almost 5 decades and applied in DCF forecasts for valuation of oil and gas properties.

Self‐assessment and the tax audit lottery: the Australian experience

Suggests that, as the UK moves to a system of self‐assessment for determining income tax liability, it is instructive to look at the experience of Australia, where such a system has operated for the last ten years. Reports that the Australian experience identifies significant changes in the operations of accountants, the ethical pressures to which they are subject and the rise of the “tax agent” as a specialized tax practitioner, all of which we might anticipate to be mirrored in the UK.

Personal Income Tax Deductions in Australia, 79/1978–1990/91*

An analysis of deductions claimed against personal income tax in Australia over the period 1978/79–1990/91 indicates that the level of claims is positively related to both the marginal tax rate facing the taxpayer and to the taxpayer's net income. However, only a small part of the large increase in deductions claimed can be explained by these factors. An exogenous trend indicates an increased ‘taste’ for deductions. Evidence for this is a high correlation between deductions claimed and the proportion of taxpayers who submit their returns via a tax agent