Leading Liverpool tax specialist aids guidance in new HMRC tax fraud policy

Those committing tax evasion could face stricter consequences due to the change in government tax legislation, according to a top city accountant.

Des Veney, Director of Haines Watts Chartered Accountants on Victoria Street, believes that as a result of the stern regulation, which came into effect earlier this month, UK citizens will no longer have the opportunity to co-operate and deny allegations of tax fraud.

Over the past two years, HM Revenue and Customers has offered three options within the Code of Practice 9 (COP9) to taxpayers who are under tax investigation – these being acceptance of a contractual disclosure facility (CDF), denial with cooperation and denial without cooperation. However this luxury has been withdrawn.

Des said: “As a result of HMRC scrapping the more lenient approach, taxpayers with undisclosed amounts will receive a letter from HMRC informing them that they are subject to COP9. They will then have 60 days to decide whether to accept the CDF or deny fraud.

“Taxpayers will be unaware of what the tax investigation relates to, as well as what evidence the HMRC holds against them. Therefore, it is expected that many people will admit to fraud in order to avoid prosecution. Nevertheless, their total unpaid taxes, late payment interest and penalties will be due.“

According to recent HMRC statistics, almost £24 billion of unpaid tax has been recovered. Following the tighter measurements that have been put into place by the government, these figures are expected surge over the next 12 months.

Des added: “For those who have received a COP9 letter, my advice to them is to book an appointment with one of our tax specialists as soon as possible.

“Whether clients are innocent or in fact guilty of tax evasion, our aim is to effectively guide people through this troublesome time by providing on-going help and support.“