HMRC gearing up to name and shame tax evaders

H M Revenue & Customs (HMRC) has confirmed that from 1 April 2010 it will start naming and shaming serial tax evaders. North West businesses are being warned that from this date, individuals and companies which have deliberately evaded tax of more than £25,000 will have their name, address and details of their evasion published on the HMRC website. The measure was announced in Budget 2009 but the timing has only just been announced.

John O’Mahony, Head of Tax at RSM Tenon in the North West, said: “This measure is further evidence that HMRC is prepared to take a really tough line on tax evasion. Its introduction coincides with the notification deadline of the Tax Health Plan under which medical practitioners have the opportunity to disclose undeclared income in return for a lenient penalty. We know HMRC will be actively pursuing those who haven’t taken advantage of this amnesty and it can now add ‘naming and shaming’ to its armoury. We strongly urge anyone who hasn’t taken action and has concerns over their tax affairs, to do so now before it is too late.

“Over the next couple of years, HMRC will continue in its drive to encourage good compliance behaviour and will pursue those it believes are evading tax and we expect to see further announcements on this in this year’s Budget on, for example, blocking loopholes involving schemes which turn income into capital.

“ We are seeing a profound shift from an environment in which HMRC did the checking to one in which the system will be based on people coming forward to bring their own tax affairs up to date – with much heavier penalties for those who do not do so. The world of tax is currently undergoing significant change and what will emerge will be an environment where tax evasion will not be tolerated.

“The message from HMRC at the moment is loud and clear – it may, in the words of its mission statement be ‘passionate in helping those who need it’, but it will certainly relentless in pursuing those who ‘bend or break the rules’. Those who have trouble sleeping at night because they know they have evaded tax really should think about seeking professional advice to manage making a disclosure to HMRC.”