Coming Clean

HM Revenue & Customs are about to launch a campaign advising that they are closing in on undeclared income and this follows close on the heels of their “My Tax Return Catch Up Plan” initiative that is about to come to a close. The “Closing In” campaign provides details of how to check whether you need to complete a tax return and how to rectify any previous errors or omissions. Businesses who have previously submitted employer end of year returns (forms P35) but who have not yet made any submission under the new RTI system will also be receiving reminders and although penalties should not be charged until 2014/15 it is important to ensure that matters are brought up to date as soon as possible. As part of their overall push against tax evasion the Revenue have announced that the information on all credit and debit card payments to UK business will be available to them for the first time. The legislation came into force on 1 September 2013 enabling the Revenue to obtain payment details for the previous four years. Additionally more international exchange of information agreements are providing details of foreign assets and income of UK taxpayers to the UK authorities. This information will undoubtedly form part of the Revenue’s Connect system containing taxpayer records as well as information from third parties and the internet. The system will use extensive data-mining and predictive analytics to identify tax evaders and target enquiries more productively but also underlines the need to ensure that all sources of income and gains should be correctly reported. It will be essential to ensure that the details held by all data providers are correct to avoid the risk of information being linked incorrectly by the Revenue, for example a bank account held purely as a nominee could be ascribed to the nominee rather than the beneficial owner. If an asset is held on bare trust any information relating to that it would be regarded as pertaining to bare trustee and it will be worthwhile to update the official records as soon as possible. If you have any concerns or queries regarding any of the issues raised in this article you can contact The MGroup via the Contact Page or telephone 01865 552 925 / 01993 776476.