HMRC Campaigns and Amnesties are an alternative to tax investigations
There has been a dramatic sea change in HMRC’s compliance approach in recent years, with HMRC campaigns or tax amnesties being very much at the forefront.
In fact the department now has dedicated HMRC campaigns teams.
HMRC campaigns are generally sector or industry specific, focusing on as HMRC put it, the “significant minority who are not paying the correct taxes”
The department run HMRC campaigns or tax amnesties to prompt those taxpayers with undisclosed income or gains to come forward voluntarily. Essentially HMRC adopt a “carrot and stick” approach.
First the carrot:-
Come forward and make a voluntary disclosure and in return
- HMRC will almost certainly not prosecute
- You will receive a greatly reduced, generally fixed, penalty
Second the stick:-
Miss the amnesty or HMRC campaigns deadline for any reason and you face
- A criminal prosecution if conduct is deemed serious enough.
- A much more punitive financial penalty, up to and sometimes exceeding 100% of the overall tax loss to the exchequer.
Campaigns launched to date
Offshore Disclosure Facility
New Disclosure Opportunity
Liechtenstein Disclosure Facility
Tax Health Plan
The Tax Catch Up Plan
Plumbers Tax Safe Plan
Electricians Tax Safe Plan
The E-markets Disclosure Facility
What is the HMRC campaign process?
Phase 1 – HMRC campaigns will use their formal powers to obtain information from third parties. These are otherwise known as third party information requests. At this point HMRC campaigns are seeking to identify “risk” cases. In other words those cases where tax may have been underpaid.
Phase 2 – HMRC campaigns offer those taxpayers who themselves consider tax may have been underpaid, the opportunity to come forward under amnesty. Those who do come forward of their own volition are offered favourable or reduced penalties, which are generally fixed.
Phase 3 – Those who do not come forward face a formal HMRC tax investigation, which will either result in a criminal prosecution or entirely more punitive penalties. A formal tax investigation can also occur if HMRC feel that an incomplete or inaccurate disclosure has been made.
Allow a tax investigation specialist to guide you through the HMRC campaigns process
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If you have any questions regarding HMRC campaigns or amnesties please give our friendly helpful team a call on 0330 999 5000.