VAT amnesty launched by HMRC

HMRC has launched another new amnesty campaign, this time aimed at businesses that should be paying VAT but have not registered.

Later this year, the Revenue intends to crackdown on unregistered companies and this amnesty will give them to chance to get their business affairs in order.

It is thought the initiative will operate on the same lines as the previous campaigns targeting people with undeclared assets in offshore bank accounts and sectors where a high risk of tax evasion has been identified.

The director of risk and intelligence at HMRC, Mike Wells, explained that future campaigns will be modelled on the VAT initiative. The Revenue plans to be more open the compliance activity it is undertaking to make sure the tax gap reduces and customers get the help they need to pay what they owe.

So far, the Revenue has raised in excess of £500 million from its voluntary disclosure campaigns and another £100 million from follow-up activities. An HMRC statement said that the department is providing easy and straightforward ways for customers to get their records in order. In return they receive the best possible terms. However, people who still do not comply will be liable to penalties and surcharges once the department starts cracking down.

Billy Cairns, a VAT partner at PKF, a leading firm of accountants, said the VAT amnesty could prove to be a very good deal. He pointed out that a lot of business owners think their turnover will not be high enough for VAT registration and if they let things slide for more than a year they will be left facing huge bills.

However, if HMRC wants the campaign to be successful, any voluntary disclosure facility must include cash in hand activities that have not been recorded in the books, he added.

© 2019 All rights reserved. Reproduction in whole or in part without permission is prohibited. See our copyright notice.

Tags: , , ,

Leave a Reply