Disclosure of Tax Returns

This week has seen David Cameron and other members of parliament disclose their tax returns in an effort to demonstrate that they have not participated in tax avoidance schemes. No evidence of wrong-doing has been identified, although some tax arrangements have been described as morally unacceptable. Now that some politicians have disclosed tax returns since taking office, more pressure is being applied to reveal historical information and the net is widening to include other politicians. To what extent has this disclosure set a dangerous precedent and can it be considered an irresponsible act?

From a recruitment perspective we already have requirements for credit checks to be performed in some professions as part of due diligence, and occupational health checks have almost become a de facto standard upon commencing employment. Is the disclosure of tax returns, albeit with the best of intentions, the first step towards employers demanding to see tax returns from their employees? Will mistakes made completing tax returns come back to haunt candidates? We have already seen cases where job applicants have written something as a teenager on social media only to have their comments reviewed years later as an indication of their suitability to do a specific job.

Tax returns are supposed to be private and confidential. If someone is suspected of abusing the tax system it is the responsibility of HMRC to undertake an investigation and to provide a determination using laws that are in place.

Of course specific information is needed during the recruitment process to demonstrate capability to do the job for which candidates are applying, but this does not include information such as date of birth, National Insurance number or full address. These details would not be required until after a contract of employment is offered and accepted.

The problem is that job applicants will feel compelled to provide more information than is required. They will feel that not providing the details may harm their chances of gaining employment; in other words, they feel they either disclose the personal information requested or lose the opportunity completely.

Have we reached a point in time where the desire to provide transparency about who we are and what we have done is aiding and abetting people with criminal intent to use our personal information? Conversations about possible opportunities can entice personal information which could be used for identify theft and fraud, which are already at an all-time high.