Personal Wealth & Tax Planning 20 May 2024

Beware the rise of TikTok tax advice

This article was first published in South West Business Insider magazine.

Social media is a mainstay of everyday life. Once the preserve of teens who could hide in a domain where their parents never dared to venture, now it is the everyday for everyone. Millions use TikTok, Facebook, Instagram or X to gain information or spread their world views.

And so it is that even the world of dreary old tax has staggered onto these platforms. I’ve been struck in recent months by the sheer volume of tax advice being disseminated by those who claim to be expert in all aspects – from taxes affecting companies, through employment and other income taxes to capital gains and inheritance tax.

The problem is that a lot of the information being posted is at best misleading, at worst plain wrong and likely to result in anyone taking the advice offered ending up in hot water with HM Revenue & Customs (HMRC).

So, why am I bothered? I’ve recently joined PKF Francis Clark after nearly three decades with a national firm serving in tax and business leadership roles. I have seen the explosion of aggressive tax planning in the 1990s and 2000s melt away into an environment where such planning does not work and is reputationally unacceptable to both taxpayer and advisor – and to the general public, who just want to see everyone pay their fair share.

This explosion of dodgy advice from apparently unqualified influencers helps no one.

Although not regulated (yet) by government, the tax profession has to abide by the rules and codes of conduct of its professional bodies and a code agreed with HMRC to govern activities. So, this explosion of dodgy advice from apparently unqualified influencers helps no one. And from the position of the tax professional, it potentially brings all advisors into disrepute as we risk being tarred with the same brush.

What I’d like to see for the sake of all taxpayers who just want to get their tax affairs right is for HMRC to clamp down on those spreading false or dodgy ideas around tax on social media, in the same way other government bodies intervene when people are put at risk.

Furthermore, this explosion of bad advice needs another response from HMRC in terms of education too. I’ve long argued that the UK needs wholesale simplification of its highly complicated tax regime, and alongside this we need citizens to be better educated as to what tax is and how it works. In my opinion, this should even form part of the national curriculum.

I’m not suggesting such education would be at professional level of qualification but merely to explain the differences between tax on individuals on earnings, savings and investments, and how companies pay their taxes.

Social media is an everyday part of life, and there are many great aspects to it. But I care about tax. And so when it comes to advice, we need to make sure what is published is accurate, balanced, fair and that it can be relied upon.

Find out more about PKF Francis Clark’s tax team.

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