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Tax fraud needs more focus, not avoidance says CloT

There needs to be a higher emphasis on combatting tax fraud at a time when HM Revenue and Customs is looking to tighten the tax gap – that is the CIoT’s verdict after recent tax numbers were released last week.

The figures show a shortfall that has been reduced from 6.8 per cent to 6.4 per cent, in terms of cash remaining static at around £34 billion.

Of that figure, it has been estimated that £2.7 billion was lost in tax avoidance, falling from £2.8 billion in the previous 12 months. Additionally, there was £5.1 billion lost in criminal attacks, £4.4 billion to tax evasion, and £6.2 billion to the ‘hidden economy’- a combined £15.7 billion in illegal activity.

John Cullinane, director of tax policy for John Cullinane, said that more effort is needed by HMRC in investigating and punishing anyone involved in tax evasion.

He said that the government is doing the right thing by investing time and money in this area, adding:

“It should be noted though, that HMRC’s avoidance figure does not include a lot of what gets described as avoidance in the newspapers, especially in relation to multinational businesses. This is because, as HMRC puts it, it ‘is the result not of frustrating UK law but of exploiting the international tax framework’.”

Small and medium sized businesses in the UK more than ever need to be on the right side of the law when it comes to HMRC. Utilising the services of an accountant in the Wirral is one way of ensuring that no fatal mistakes are made, whether intentional or not.

Posted by Louise
November 5, 2015
Tax

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