It’s no longer enough not to advise clients on ways to evade paying tax – HMRC has made it an offence to fail to prevent anyone else doing so. Peter Bartram looks at where the battle lines are being drawn
Her Majesty’s Revenue and Customs has launched its new weapon in the war on tax cheats – an offence of “failure to prevent the facilitation of tax evasion”. The mechanism started ticking for real on 30 September. Companies and professional advisers who have not prepared themselves adequately may soon find out how powerful the new weapon is.
But many firms have already shrugged their shoulders, given a resigned sigh, and started to put in the extra work to make sure they stay on the right side of the new law.In many cases, firms will build on the anti-money-laundering arrangements they already have in place, points out Frank Haskew, head of tax in the Tax Faculty at ICAEW. But Amit Puri, director of tax investigations at Grant Thornton, thinks the penny has yet to drop. “Those that consider themselves low risk may need to think again and the days of turning a blind eye or not asking probing questions of business counterparts may be over.”
Those who think they can argue over the meaning of the word “facilitation” could be in for a shock. HMRC takes it to include anyone who has encouraged, assisted, aided, abetted, counselled, procured or done anything that helps to commit a UK tax evasion offence.
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