Let’s
HMRC launches VAT disclosure opportunity
Mike Wells, director of Risk and Intelligence at HM Revenue & Customs, discusses a new opportunity for those liable for VAT to put their affairs in order.
HM Revenue and Customs (HMRC) is working with interested parties to design a campaign that targets businesses and individuals who are trading above the VAT threshold but who have not yet registered for VAT. The current VAT threshold is £73,000 turnover.
Interested parties include the Institute of Chartered Accountants in England and Wales, the Chartered Institute of Taxation, the Association of Accounting Technicians, the Federation of Small Business, Tax Aid and Citizens Advice Bureau. The VAT Initiative, launched on 5 July 2011, provides an opportunity for businesses and individuals that ought to be registered for VAT to come forward and put the record straight on the best available terms. The initiative will also apply to people or businesses who should have been registered in the past.
Businesses and individuals wishing to take part in
the VAT Initiative will have three months until 30 September to notify HMRC. They will need to contact a dedicated helpline - 0845 600 5217 - or visit
http://www.hmrc.gov.uk/ris/vat to register or notify. This is simple and straightforward and will involve telling HMRC a few personal details such as name, date of birth, address and a telephone number.
How to take part
Those who register in this way will be charged a reduced penalty of up to 10 per cent on the VAT that
Once the 30 September deadline has passed, HMRC will use information that it holds, as well as third party information, to identify businesses and individuals that we would have expected to register for VAT during the campaign. We will then start follow-up activity such as full enquiries and criminal investigations wherever possible. We have deliberately publicised details of the VAT Initiative well ahead of launch in order to encourage earlier discussion with interested parties such as agent representative bodies.
Series of campaigns The VAT Initiative is the latest in a series of HMRC campaigns aimed at reducing the tax gap by focusing on areas where a significant underpayment has been identified. Previous campaigns have targeted offshore investments, medical professionals and people working in the plumbing industry. In each case, we have used new technology and legislation to gather and analyse data from a variety of sources in order to identify people who should come forward. HMRC’s future campaigns will target, in addition
to VAT rule-breakers, private tuition and coaching and e-marketplaces and will be launched over the next year.
Web robot
has been paid late and will be expected to submit their first VAT return on time (including paying the VAT due).
If they take up this opportunity they will also be offered help in disclosing any other tax arrears with the benefit of reduced penalties, if applicable.
Voluntary disclosure
HMRC encourages anyone who has unpaid tax to come forward and make a voluntary disclosure. It will always be less expensive if customers come to HMRC voluntarily rather than waiting until we catch up with them.
The department will use cutting-edge tools such as “web robot” software to search the internet and find targeted information about specified people and companies.
Our strategy is to provide simple, straightforward opportunities for these customers to put their records in order on the best available terms. We then immediately follow this with activity focused on those who choose not to take up the opportunity. To date we have raised over £500m from voluntary disclosures. We have also raised a further £100m from follow-up compliance activity.
6 ToolBUSINESS+HIRE
www.toolbusiness.co.uk
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Reply No. 226
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