Mr Darling and his accountant get it wrong

Mrs R wouldn't like to be in Mr Darling's accountant's shoes this morning when they read this item in the Telegraph. She would have thought a good accountant would know the tax rules. :-

HMRC told The Daily Telegraph on Tuesday night that MPs were not exempt from tax laws and that tax must be paid on some expenses.

In a statement it said: “It’s a general principle of tax law that accountancy fees incurred in connection with the completion of a personal tax return are not deductible.

“This is because the costs of complying with the law are not an allowable expense against tax. This rule applies across the board.”

It also emerged that MPs had already been given specific guidance by HMRC prohibiting such tax- free claims, which accountants say constitute a “benefit in kind” and should be taxed.

Issued in 2005, the guidance states that “accountancy fees incurred in the preparation of the self assessment tax return or related expense claims” are “not allowed” as tax expenses.

Mike Warburton, an accountant at Grant Thornton, said: “HMRC produces very helpful guidance for MPs, which explains exactly what is allowable.

“MPs are responsible for their own tax affairs and for making their own declarations to the authorities.”

It rather worries Mrs Rigby that the Chancellor of the Exchequer needs somebody to check his Income Tax returns - in case he has made a mistake with his sums.