Ending tax evasion and aggressive tax avoidance schemes will be an aim of HMRC and, in extreme cases the Crown Prosecution Service, it has been announced.
The Crown Prosecution Service (CPS) director, Keir Starmer, stated that the number of tax cases handled by the CPS is expected to increase to 1,500 a year by 2014/15, signalling a crackdown on the worse examples of tax evasion as the deadline for the completion of self-assessment tax returns draws near.
It is part of a determined policy by HMRC to get tough with tax cheats, with individual offenders ‘named and shamed’ in the press and continuing pressure on those who fail to disclose taxable income.
HMRC scrutinises tax avoidance schemes
In the 2012 Autumn Statement, the Chancellor George Osborne revealed that an additional £77m was being invested in increasing HMRC revenue from tackling tax avoidance and evasion. Mr Osborne said: ‘The government is clear that while most taxpayers are doing their bit to help us balance the books, it is unacceptable for a minority to avoid paying their fair share, sometimes by breaking the law.
‘We are determined to tackle this problem and HMRC are making good progress, but we are giving them additional tools to bring in more’, he added, stating that HMRC would also focus on advisers who recommend aggressive evasion schemes.
Closing in on tax evasion
HMRC’s new initiatives, which see a focus on undeclared offshore accounts in countries such as Switzerland and Liechtenstein, follow a number of campaigns aimed at particular groups who may have failed to declare the full extent of their liabilities.
These have included plumbers, tutors and online traders. In March 2013, the emphasis will switch to those who have sold second homes (in the UK or overseas) and may owe capital gains tax (CGT). To encourage people to come forward, HMRC offers a ‘tax amnesty’ before a certain deadline, during which penalties are restricted to 10% of the sum owed, rather than the 100% fine that may be imposed later.
Tax return disclosure
For most people, the way to avoid unwelcome attention from HMRC is to make a full disclosure of your income via a self-assessment tax return. The online form has extensive help notes on what to declare and in cases of doubt HMRC’s enquiry centres should be able to clarify what you need to declare.
Disputes are actually rare and HMRC’s latest report admits that, ‘93% of tax due is paid’. Where there is a disagreement, individuals can ask for a review or independent tribunal. Find out more in our guide to tax disputes.
Check your tax
If you are uncertain of your tax position, you can use the Which? tax calculator to check your 2011-12 tax bill. Our online tax guides give background details to capital gains tax and property, tax on savings and investments and inheritance tax as well as income tax and self-assessment tax returns.
And if you have a question about tax, or any other financial matter, give the Which? Money Helpline a call. Our team of qualified experts can help you with any question. Sign up to Which? for just £1 and speak to one of our experts.