mountain hikers

Tax Disclosure

Our practical and robust approach delivers the best possible outcome.

Call our free confidential hotline

+44 (0)800 656 9990
Our webinar Finance Act 2020: Coronavirus receipts and penalties looks at this in more detail.

Webinar: Finance Act 2020

Since the introduction of the Coronavirus Job Retention Scheme, otherwise referred to as furlough, HMRC have been keeping a watchful eye on proceedings. In July they announced that they had made their first arrest in connection with coronavirus-related fraud, showing that they intend to act quickly to recover money incorrectly claimed or used.

Companies using the Coronavirus Job Retention Scheme will need to pay close attention to how they are recording information to ensure that they do not incur penalties, and are not committing furlough fraud. 

Types of disclosure

Voluntary Disclosure

Voluntary disclosure of unpaid or underpaid taxes will result in:

  • lower professional costs
  • lower penalties
  • allowance for negotiation for protection against criminal prosecution (in serious cases).

Prompted Disclosure

Prompted disclosures will usually carry higher penalties. It is important to seek professional advice, which will:

  • help prevent an HMRC data fishing exercise
  • ensure a high quality disclosure, which will help reduce penalties
  • enable negotiations with HMRC to achieve the best possible outcome
  • ensure the best defence against criminal prosecution (if necessary).

Why disclose now?

Increased chance of discovery

  • There is now an automatic exchange of financial information between countries; the Common Reporting Standard.
  • HMRC’s ‘connect’ software allows the collection and analysis of billions of lines of data, meaning individuals are more susceptible to investigation by HMRC (whether correctly or not).

Consequences of non-disclosure

  • Higher penalties from HMRC which, for offshore offences, could be (up to 300% of the tax due).
  • Reputational damage from HMRC’s ‘Name and Shame’.
  • Change in HMRC stance (more prosecutions).

Contact us

Sean Wakeman
Sean Wakeman
Partner, Tax Resolutions
John Cassidy
John Cassidy
Partner, Head of Tax Resolutions