Ethical Behaviour

Ethical Principles for Accountants

A set of standards, including integrity and objectivity, that must be applied to all accounting activities such as VAT and payroll.

Integrity in VAT Reporting

The requirement for an accountant to be honest and fair when treating all VAT transactions,regardless of internal pressure.

Pressure to Reclaim Non-Allowable VAT

A situation where an accountant must act with integrity by refusing to reclaim input VAT on items like company cars with private use.

Integrity in Payroll

Acting honestly by ensuring all workers are correctly registered on the payroll system to comply with legislation.

Objective Decision-Making

Remaining unbiased and honest when dealing with financial records, even when faced with pressure from within the business.

Cash in Hand Payments

An unethical practice where workers are paid outside the payroll system to avoid NIC and pension contributions; accountants must resist this to maintain integrity.

Honesty with HMRC

The ethical obligation to report accurate data and clarify unusual situations to ensure the business follows correct guidance.

Ethical Handling of Non-Allowable Expenses

Maintaining integrity by not reclaiming VAT on prohibited expenses, even if pressured by superiors to reduce tax liability.

Consequences of ‘Cash in Hand' Breaches

Bypassing the payroll system is a breach of legislation that an ethical accountant must prevent by registering all employees.

Professional Accountability

The responsibility of the accountant to remain honest and objective to avoid bringing the accounting profession into disrepute.

Internal Pressure and Integrity

The ethical requirement to remain honest and objective regardless of where pressure originates within an organization.

Integrity vs. Take-Home Pay Adjustments

Resisting requests to avoid deductions like Income Tax through unofficial payments, as this violates payroll integrity rules.

Objectivity in VAT Transactions

Treating all VAT data fairly and without bias to ensure the accuracy of the VAT Return.

Handling Ethical Dilemmas in Payroll

Applying honesty when directed to ignore statutory deductions or misreport employee figures.

Self-Serving vs. Ethical Communication

Using the HMRC website or written confirmation to ensure honest and correct application of legislation.

Integrity in Statutory Compliance

Ensuring the business follows VAT and payroll law honestly to prevent professional misconduct.

Resisting Dishonest VAT Claims

An application of integrity where an accountant refuses to file false input tax claims for personal or business gain.

Fair Treatment of Transactions

The core of integrity and objectivity, ensuring every financial record for VAT/payroll is recorded truthfully.

Upholding Standards under Pressure

Maintaining objectivity and integrity when a director or manager requests unethical financial adjustments.

Ethical Communication with HMRC

Seeking clarification and obtaining written confirmation for unusual situations to maintain a record of honest investigation.