HMRC to be made preferred creditor in tax avoidance crackdown
A range of measures designed to crackdown on tax avoidance and evasion with a view to raise £2bn over the next five years have been announced by the government.
HMRC will be made a preferred creditor in insolvencies, Chancellor Philip Hammond announced today.
The government will end the practice of purchasing services through offshore countries and introduce a restriction on the small and medium sized enterprise research and development tax credits scheme.
“Today we continue the work of the past eight years where we have secured £185bn since 2010 which would otherwise have gone unpaid, with a package of measures today to further clamp down on tax avoidance, evasion and unfair outcomes raising £2bn over the next five years,” Hammond said.
“We will make HMRC a preferred creditor in business insolvencies to ensure that tax that is collected on behalf of HMRC is actually paid to HMRC and end the practice of purchasing services through overseas branches to avoid UK VAT and crackdown on insurance companies routeing services through offshore territories, and will stop our generous R&D tax credit system being abused by reintroducing a PAYE restriction for the small and medium sized scheme.”