Under the new clampdown, HMRC are set to contact taxpayers in writing to tell them they’re suspected of fraud, giving them a chance to enter into a civil contract, which allows them to come clean within sixty-days, without the possibility of facing a criminal investigation.
Instead an investigation will be carried out by HMRC using civil powers, with a view to a civil settlement for tax, interest and a financial penalty. However, anyone who opts not to sign the civil contract or anyone who does sign it but then doesn’t disclose details of wrongdoing will face a full investigation which could include a criminal probe with a view to prosecution.
A spokesperson for HMRC has said the contracts will be a new element to its civil investigations, making it harder for those under scrutiny to say they would go along with an arrangement and then fail to disclose what they know.
The spokesperson added that people would not be able to get off by signing the contracts as they would need to pay the penalties involved and added that sensible decisions would be taken in each case.
Speaking of the new procedures, which are set to come in force on January 31st, Exchequer Secretary to the Treasury, David Gauke, said: “This new facility is a valuable tool which will help HMRC in its fight against fraud.
“HMRC will set out clearly what is expected of taxpayers, and what will happen to fraudsters who choose not to disclose their crimes.”
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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( 3 / 130 )The rate of Consumer Price Index (CPI) inflation within the UK fell steeply in December 2011, to 4.2% - down from 4.8% in November, according to the Office for National Statistics (ONS).
The drop in the CPI rate is said to be the biggest monthly fall since April 2009 and the lowest since June 2011; whilst the Retail Price Index (RPI) inflation, which includes mortgage interest payments, also fell to 4.8% from its previous 5.2%.
According to the ONS the drop in both the CPI and RPI is due to lower fuel prices and cheaper clothing, with sharper falls expected in the coming months.
One economist has said of the drops: “The increase in VAT from 17.5% to 20% last January should fall out of the year-on-year comparisons, which on its own should shave 1% or more off the annual rate.
“At the same time, food, clothing and energy prices are now all falling, suggesting a broad-based lowering of price pressures, which should have a marked downward effect on the headline rate of inflation in coming months.”
The falling inflation is expected to ease the squeeze on consumers’ spending power, whilst at the same time giving the Bank of England leeway to extend its quantitative easing (QE) programme to stimulate the economy.
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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( 3 / 133 )According to a leading Think-Tank the UK has already double-dipped back into recession, as interest rates look set to stay on hold at their record low until 2016.
It’s believed that the predicted growth of around or under 1pc for years to come will force the Bank of England to keep base rates at 0.5pc.
The Think-Tank, the Centre for Economics and Business Research (CEBR) believes the UK economy shrank in the last three months of 2011 and is still contracting during the current quarter, marking another recession.
Chief Executive of CEBR, Douglas McWilliams, said: “The world is going through a fundamental change where previously poor economies are industrialising fast. This is good news for them, but because of the limits imposed by shortages of energy, minerals and food, some of their growth is at our expense.
“This is not to say that if we break off trading with them we will be better off. On the contrary, a strategy of disengagement with the rest of the world would make matters very much worse.”
The CEBR have already slashed its expectations from the already low 0.7pc it predicted in October 2011, to a 0.4pc fall, advising prospects for the economy in the UK hinge on the fate of the Eurozone.
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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( 3.1 / 138 )With only a few weeks to go until the tax return deadline, the Treasury have closed a tax avoidance scheme which could have cost £1.5billion in lost tax receipts.
Following a tip-off that artificial trading companies were being set up in tax heavens, the Treasury has opted to close a scheme which could have cost the economy in lost tax receipts.
It’s believed that wealthy individuals were planning to use to use a long standing “past-cessation trade relief” – designed for tradesmen and professionals to offset legitimate costs against their income – to artificially reduce their tax bills.
Exchequer Secretary, David Gauke, said the scheme would have put a “significant” amount of money at risk, adding: “It is unacceptable, at a time when we are trying to bring down the deficit, that there are those who try to avoid paying the tax they owe.”
The current scheme could have legitimately been used by a tradesperson or professional who had ceased trading, but later incurred costs from responding to customer requests where they remained liable.
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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( 2.9 / 140 )Ministers have called on Her Majesty’s Revenue and Customs (HMRC) to clarify how the introduction of real time information (RTI) for universal credits will affect SMEs.
In a report released today, the Parliament’s public accounts committee says HMRC must clarify how RTI, which is being developed by HMRC to support the introduction of the new universal credit, will affect small businesses and the self-employed who may not use electronic payroll systems.
Chair of the Public Accounts Committee, Margaret Hodge, said: “The sheer complexity of the benefits system places a heavy burden on claimants.
"People claiming multiple benefits, such as housing benefit and child tax credit, deal with different public bodies.
“This can be confusing and potentially discourage legitimate applications. Departments responsible for means testing must work together to get a better understanding of the burdens placed on claimants."
The report also states that HMRC need to develop an effective approach for those claimants and businesses that are likely to be outside RTI in order to try to prevent previous problems which have affected tax credits.
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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