We at The Accountancy Solutions follow every rule and take upmost care when it comes to calculating tax liability of our clients. In the past few years we have come across serious types of Tax Avoidance Tax Evasion which unfortunately are being aggressively promoted by some accountants. We have conducted interviews of clients who have been part of such aggressive schemes.
Tax Avoidance and Tax Evasion should not be taken lightly and tax payer should disclose any material facts and pay avoided tax to HMRC as soon as it comes to his attention. This will save time, money and of course heavy penalties which HMRC may impose if they start questioning about such tax evasions.
One of the case of aggressive tax avoidance which we have become aware of is facilitation by some accountants and tax advisers to clients for corporation tax. In most of the cases it is permissible by law where accountants can hold client money to pay taxes on their behalf.
In this type of tax evasion, accountants ask clients to transfer money equivalent to corporation tax to their company or trust bank accounts and they will pay the corporation tax on behalf of clients. This amount is then charged back to company accounts as an expense and shown as consultancy fee.
In this kind of tax evasion, corporation tax is avoided to the extent of the amount charged to the accounts which were original to be booked as corporation tax liability. Charging corporation tax as consultancy fee will have a knock on effect of 20% on actual tax liability.
Accountants marketing these arrangements also ask tax payer or clients to pay cash for facilitating tax evasion. This would be a serious offence and would attract charges of bribery and corruption. HMRC under these circumstances will issue letters to the tax payers to recover evaded tax. HMRC is not under any obligation to tell tax payers what they know instead they want tax payers to make a full disclosure, whatever tax has been avoided in past 21 years.
We have come across professional including IT Contractors, NHS Doctors, Locum GP’s and NHS Consultants who have been the target of this scheme and potentially owe HMRC avoided corporation tax and self-assessment tax for past years. As a locum doctor and running own Personal Service Company, you are liable for all taxes. Under current circumstances and HMRC will vigorously pursue to recover any tax avoided through such schemes. HMRC can scan different data base through its state of art computer system ‘CONNECT’ and will be aware of the potential tax liability of a tax payer.
Investigations related to tax evasion may have serious consequences. Accountants and tax advisors promoting tax avoidance schemes will be subject to criminal behaviour under Criminal Finance Act 2017 explain corporate offence of failing to prevent the facilitation of tax evasion.
If you have been promoted such scheme we would strongly advise you to get a second opinion and call us today on 0121 629 7768. At the Accountancy Solutions, we give free confidential advice and will calculate your actual tax liability.