Help with tax evasion investigation.

antrobus

keaton wrote: »

Is going back 20 years a regular thing? As the moonlighting DJ in this thread is classed as tax evasion on a deliberate level, is he likely to be looked back over 20 years?

The time limits for HMRC to investigate an individual’s income and capital gains tax affairs will in future be as follows:

• Four years if there is a discovery of tax loss
• Six years where there is a failure to take reasonable care
• 20 years for deliberate understatement.

http://www.moneyobserver.com/our-analysis/when-inspector-comes-calling

Ballymackeonan

It used to be open-ended: they would look at the previous 7 years, depending on what was found could then look at the previous 7, and so on.

I came across one investigation in the 1970s which went back 35 years!

Pennywise

purdyoaten wrote: »

It is only in very extreme cases that HMRC will pursue criminal charges for fraud. There are various documents a taxpayer will have to sign before closure of the investigation, one being a declaration that there has been full disclosure. Even in the large case that I previously mentioned, which was carried out under Hansard, there was never any suggestion of criminal prosecution. I have come across this only once and that was for a third offence!

In one of my previous jobs, we had a client who got a couple of years in prison, and from what I remember, the tax he evaded was around £100,000, but that's 10-20 years ago. It was his first offence, but he didn't come clean straight away and continued to be evasive throughout the enquiry. I think it ended up a criminal case because of the deliberate fraud and deceit he employed - he was trying to be clever and was running two sets of "books", had a second "hidden" business bank account in the UK as well as an offshore bank account, so he was evading VAT and income tax/NIC, and he was also evading employer taxes because he only put half his staff through the payroll, the other half went through his second set of books, so he pocketed their tax/nic deductions too. So I think HMRC look not only at the tax evaded, but also at the behaviour of the evader, i.e. whether it was down to stupidity or whether it was a deliberate, calculated act.

purdyoaten

Pennywise wrote: »

In one of my previous jobs, we had a client who got a couple of years in prison, and from what I remember, the tax he evaded was around £100,000, but that's 10-20 years ago. It was his first offence, but he didn't come clean straight away and continued to be evasive throughout the enquiry. I think it ended up a criminal case because of the deliberate fraud and deceit he employed - he was trying to be clever and was running two sets of "books", had a second "hidden" business bank account in the UK as well as an offshore bank account, so he was evading VAT and income tax/NIC, and he was also evading employer taxes because he only put half his staff through the payroll, the other half went through his second set of books, so he pocketed their tax/nic deductions too. So I think HMRC look not only at the tax evaded, but also at the behaviour of the evader, i.e. whether it was down to stupidity or whether it was a deliberate, calculated act.

Good point! The case that I referred to settled for 1.2 million. The guy had worried about the whole situation for years and suddenly decided to come clean on the day that he retired. The fact that he informed HMRC (or got me to do it) as opposed to HMRC finding out first was obviously a major factor. From memory, the penalty was only around 20% which was a pretty good deal given the amount involved.

keaton

Ballymackeonan wrote: »

It used to be open-ended: they would look at the previous 7 years, depending on what was found could then look at the previous 7, and so on.

I came across one investigation in the 1970s which went back 35 years!

Wow 35 years, I wonder why they changed it to a maximum if 20 years?

bluelass

I spoke to my friend this evening. A few weeks ago the vengeful ex partners new squeeze was at a function at which my friend was providing the entertainment and went up to the DJ booth and requested lazy sunny afternoon by the kinks:eek: My friend says it was either a deliberate request and if not its a bloody big coincidence.

Pixie5740

Whether this is a vengeful ex, or HMRC have been approaching venues for information about casual staff, it doesn't alter the fact that your friend is evading paying tax and that is a crime. Your friend should do the decent, and legal, thing and start declaring all their income to HMRC rather than fretting over song requests.

James_B.

Pixie5740 wrote: »

Whether this is a vengeful ex, or HMRC have been approaching venues for information about casual staff, it doesn't alter the fact that your friend is evading paying tax and that is a crime. Your friend should do the decent, and legal, thing and start declaring all their income to HMRC rather than fretting over song requests.

You need to be careful, the mods take a very dim view of people recommending that anyone do the moral thing. I've had posts deleted for this.

They are remarkably relaxed, though, about people boasting about evading taxes, cheating benefits etc.

Spidernick

Someone is going to have to explain the relevance of The Kinks' song to me, as I'm afraid it went right over my head!

TBagpuss

the song starts with the words 'the taxman's taken all my dough'