Will the inland revenue prosecute?

Emerion

A friend of mine lied to HMRC about the amount of money in his father’s estate for probate. During the discussion, we realised that he need not have lied because as the estate included a house, the threshold was higher than he had believed. So now we’re wondering, if owns up to his “mistake”, will they prosecute, given that he didn’t owe them money after all? Also, if he doesn’t own up, and they find out what he did (unlikely, but you never know), will they prosecute in that circumstance? 

Jeremy535897

Your friend should seek the advice of an accountant or tax adviser who specialises in tax investigations. I doubt prosecution would be likely if no tax is actually due.

Keep_pedalling

Interesting one, you could argue that as the RNRB is not automatically applied (IHT 400 asks if you want to claim it) and he failed to claim it, then IHT was due on the estate. 

How long ago did he submit the forms?

Emerion

I’m not absolutely sure, but about 2 years ago, or a bit more. He got probate on the incorrect amount and the will was actioned quite a while ago. 

Ciprico

Surely even if tax was due and he proactively fessed up to a 'mistake' they wouldnt prosecute... 

Emerion

Yes, but he’s scared to confess, and I’m wondering if they would prosecute if he doesn’t admit it first, and they find out what he’s done. Because if it’s likely that they would prosecute, it might be possible to persuade him to do the right thing for his peace of mind. 

diystarter7

Op
From what you said, the person is clearly a worrying little soul like me. He/she should therefore declare its mistake.

Was it a mistake or clear intention to defraud the HMRC is what he needs to consider and put forward.

Either way, it is a worry and possibly calling HMRC anonymously and withholding number, see what those on the front line say.

Good luck

[Deleted User]

In such a scenario where, as Jeremy says, there is no loss to HMRC, the likelihood of prosecution is pretty close to zero. The only cost here appears to be mental stress for little reason. I only ever came across two prosecutions in over thirty years - and both were for third offences amounting to many thousands of pounds. 

This is not remotely comparable. 

Emerion

Thanks, for that @[Deleted User]. I’ll get him to read this thread.