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HMRC prepares to triple serious tax evasion prosecutions

Tax evasion and aggressive tax avoidance has been at the forefront of many recent budgets. Measures have been announced to collect more of the tax due by targeting HMRC resources to these areas.

The Financial Times (FT) today discusses a drive by HMRC to triple the number of prosecutions of serious and complex tax evaders. The crackdown announced by George Osborne in his Summer Budget will be spearheaded by the civil and criminal investigations teams at the Revenue.HMRC will receive £800m for the prosecution drive but many suspect the focus will remain on easy targets rather than those who can afford expensive defence teams. The proposed new “strict liability” rule should bring in some big scalps, but following complaints by tax lawyers and experts that the rules were draconian, ministers have added provisos to the proposed new rules, including one for “reasonable excuses”.

The FT notes that the Revenue will be keen to dispel the image of a taxman that lets off those who can afford to avoid tax, and the impression HMRC is in cahoots with the Big Four, but its remit remains to bring in revenue and big ticket prosecutions will continue to be resource-intensive with no guarantee criminal charges will stick.