HMRC target businesses not registered for VAT
HMRC have launched a campaign aimed at VAT rule-breakers. As part of this campaign they have confirmed that they will be sending letters informing certain businesses how to register to pay what they owe. The campaign is focusing on individuals and businesses trading above the VAT turnover threshold of £73,000 but who have not registered for VAT.
HMRC have advised that they will be sending in excess of 40,000 letters over the next few weeks. Those who come forward that have not registered to pay VAT have up until 30 September 2011 to let HMRC that they want to take part. If they make a full disclosure, most face a low penalty rate of 10% on VAT that has been paid late.
They will also be invited to disclose any other tax arrears. Where they have to pay a penalty on undeclared tax other than VAT, this will be lower than the customary penalty of up to 100% charged to those who fall outside the opportunity.
HMRC are warning that after 30 September 2011, using information pulled together from different sources, they will investigate those who have failed to come forward. Substantial penalties or even criminal prosecution could follow.
Mike Wells, HMRC's Director of Risk and Intelligence, said:
'This is our third campaign, raising more than £500m from voluntary disclosures and a further £100m so far from follow-up activity. Our campaigns are designed to ensure tax is paid so that the money is available to spend on public services used by everyone.'
'The aim is to make it easy for individuals and businesses to contact us, make a full disclosure of their income and face a reduced penalty on any tax owed. I urge people who have not registered their businesses for VAT to get in touch with HMRC and get their tax affairs in order simply and on the best available terms.'
Internet link: Press release