FSA paid KPMG six-figure sum for staff tax advice

This just about sums up the state we ae in; cutting benefits to people who are in real need and then using public money for tax advice for public employees. I would be interested to know the hourly rate paid for the advice. Giving advice is fine, but paying over the odds is not. I think this should be a resigning matter for the head of the FSA.

It seems wholly unlikely that the tax advice given was merely to "ensure seconded individuals paid the correct tax in both the UK and their home country", as the FSA have it. Had that been the case, the people concerned need merely have consulted the Inland Revenue (for free). Rather, it is pretty certain that they were seeking tax advice on how to plan their tax affairs in the most advantageous way possible - in short, engaging in tax avoidance. I hope we, the taxpayer, got value for our money.

The same thoughts as Bob's crossed my mind. I hope that the advice was not how to plan things to minimise UK tax. If it was, the recipients of that advice should have paid for their own advice so they owe the Exchequer a refund, if it was to determine what tax they would have to pay, they should have asked HMR&C, that kind of advice is free, in which case whoever authorised KPMG to give that advice and charge for it should refund it. Either way the UK taxpayers are owed over half a million pounds for the past 3 years. In any case are the recipients of that advice going to be charged tax for benefits in kind? I'm not holding my breath.

Once again, one set of rules for the regulator and one set of rules for advisers.

Needless to say, all of this advice was not treated as a benefit in kind for the FSA staff.

I may offer my clients and staff free tax advice, supplied by KPMG and paid for by the FSA. I'll deduct it from my regulatory fees and subscription to the FSCS.

Can anyone see a problem with this?

They could have employed a full time specialist tax advisor for far less !

My experience of large accountants and solicitors is that you have to keep on top of them or they will load the bills, including time spent correcting their errors. And if you dispute a bill, then watch out or they will charge the time on this to you rather than accepting it as an overhead for account management. And if one of their guys is not sure of something and goes round the office to see if anyone can help, then they all charge a minimum slice of time to you.

So I suggest that the FSA did not ask KPMG for fixed fees, or realise that if they said "Hi" to a KPMG partner then this would cost them £250 a time. The charges these guys make puts them up with the bankers !