The European Commission has published recommendations regarding how to stop corporations from avoiding tax, although many MEPs feel that the recommendations don’t go far enough and want stricter limits on deductions for interest payments, tougher rules on foreign income, more transparency for trust funds and foundations, common rules for ‘patent box’ tax reductions on intellectual property earnings, and an EU…
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Serious tax evasion up
HMRC experienced an 8% increase in serious tax evasion cases for 2015/16, according to legal firm Pinsent Masons, as the government department referred an additional 3,000 suspected instances for specialist investigation. The law firm suggested that the figures represent how HMRC is under “continued political pressure” to clamp down on aggressive tax avoidance and evasion. Interestingly, HMRC investigations into high-value…
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Supreme court for Spot the Ball
In May Sportetch, the company behind the Spot the Ball competition, won its case with HMRC over £97m worth of wrongly-applied VAT.However, Sportech has been informed that HMRC has now applied directly to the Supreme Court for permission to appeal the Court of Appeal’s unanimous judgment. Sportech claims that Spot the Ball is a game of chance, not skill, and…
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EU investigation into Panama Papers
The EU has authorized an investigation into the Panama Papers in order to discover how wealthy individuals, politicians and multinational corporations were able to hide substantial levels of wealth in the Central American tax haven. A special committee with 65 members will have 12 months to present its report. 30.6.16
Rush to liquidate
Over 2000 solvent companies were placed in liquidation in March as directors rushed to cash in on lower tax rates before changes to the tax rules in April. Since then HMRC has clamped down on business owners winding up companies to access entrepreneurs’ relief at 10 per cent rate on any capital gains. Now the 10 per cent rate is…
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More higher rate taxpayers
The number of UK taxpayers paying income tax at the higher or additional rate has reached a record 5m people. However, a million fewer people will pay income tax this year than they did when the coalition government came to power, although low-paid workers are still caught in the net of national insurance contributions. Income tax revenues of £182bn are…
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SME’s suffer more
Over half of the £737m raised last year by HMRC from investigations into companies over tax avoidance and employer compliance errors comes from small to medium sized enterprises (SMEs), despite SMEs being responsible for only 11% (£96bn) of total UK payroll. This is believed to be because smaller businesses do not have the finances and resources available to pay for…
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HMRC taskforce achievements
HMRC taskforces have recovered more than £500m since they were launched five years ago with nearly £250m raised in 2015/16 alone (almost double the previous year’s yield). The taxman has launched more than 140 taskforces targeting sectors that are at the highest risk of tax fraud including the ‘adult entertainment, retail and tobacco industries. Lat year nearly new taskforces were…
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HMRC arrests were publicity stunt
Four former partners of KMCG were arrested as part of a publicity stunt according to evidence given to the High Court. In November 2015 officials from HMRC visited the Big Four firm’s Belfast city centre office and detained Eamonn Donaghy, Jon D’Arcy, Paul Hollway and Arthur O’Brien on suspicion of evading taxes. However, since then no charges have been made….
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HMRC under fire
The latest National Audit Office report on HMRC has been deeply critical. The NAO said that the quality of service for personal taxpayers was severely damaged in 2014-15 and the first seven months of 2015-16 after HMRC reduced staff numbers by a third. Some taxpayers were left waiting for more than an hour for advice and for every £1 reduction…
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