Employees who occasionally set up a ‘make-do’ office on the kitchen table rather than trek into work through gridlocked traffic are being warned that they could be exposing their homes to invasion by the taxman.

Draconian new powers granted to HM Revenue & Customs mean that an Englishman’s home is no longer his castle, says tax expert Brian Jukes, a partner with regional accountancy firm Dafferns.

He is calling for stringent safeguards to protect the rights of companies and individual employees who may be threatened with the Revenue’s new ‘search and seizure’ powers.

The powers were recently rubber-stamped by Parliament as part of a crackdown on corporate tax evasion.

A full scale review of the taxman’s powers was set in motion two years ago, following the merger of the Inland Revenue with HM Customs & Excise. Despite serious misgivings expressed by the professional community, tougher new legislation has now been passed.

Dafferns, which has a corporate practice in the Coventry and Warwickshire sub region, believes that the authorities have now become stronger at the expense of taxpayers, whose right to appeal has been weakened by the measures.

Mr Jukes says the time has come to demand a taxpayers’ charter which has real teeth, to prevent the almost inevitable abuse of authority that he predicts will result in some cases.

“Even while the review was under way, tax advisers feared a significant strengthening of HMRC’s powers, with a corresponding weakening of taxpayers’ rights of appeal,” he said.

“Although there was one good thing in the review – the provision for penalties to be suspended subject to correcting any compliance failure in future years, the overall feeling is that our fears have been borne out – although I’m sure HMRC would not agree,” Mr Jukes added.

Penalties have been significantly increased for firms that don’t comply with the revenue’s rules, and tax officials have been armed with a new set of powers to inspect records where ever they find them.

That could result in the home of employees being searched, with serious disruption to family life.

Mr Jukes said: “We are particularly concerned by the right of inspection, which allows HMRC to inspect any premises that an officer has reason to believed are used in the connection of carrying out a business.

“Modern business practice means that many people now work from home from time to time, and even if this is only for a few hours a month this could open up an employee’s private residence to a visit from HMRC.”

He added: “Of course HMRC claim that this power will be used reasonably, but there are sure to be instances of inspectors over-stepping the mark.”

Worryingly, taxpayers now have no right of appeal against an inspection that has been pre-approved by a tribunal.

“Once the wheels have been set in motion, companies must prepare to have their premises raided,” Mr Jukes warned.

Taxpayers considered to have broken the rules face tougher penalties, imposed by officials who are now hidebound by the rules and have reduced scope to exercise discretion.

He added: “For real tax evaders this should be applauded, but for the taxpayer who tries to be compliant, but makes a genuine mistake, it is likely to result in higher penalties than in the past.”

HMRC is currently consulting on the rights and responsibilities that should be included in a taxpayers’ charter, says Mr Jukes, and until it is in place he urges businesses to monitor what they consider to be unfair activity by the taxman.

“Should the worst happen, and HMRC officers turn up requesting entry to inspect your premises, take professional advice before you let them in.

“It may be that they don’t have the appropriate power and are just using bullying tactics,” he added.