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Are there particular business or areas that are targeted?
HMRC will often target a particular sector because it has become aware of consistent malpractice across the sector. Over the last few years we have seen plumbers, taxi drivers, dentists, and consultants operating under umbrella companies all being looked at. We have also seen from the national press HMRC showing a lot of interest in the tax treatment of ‘image rights’ of footballers. This has culminated in HMRC very recently issuing guidance on the tax treatment of such payments.
HMRC also look at whether or not an individual has the means to finance his or her standard of living. From the ever increasing amount of information that HMRC can obtain from financial institutions, websites and social media they potentially have a very good idea of an individual’s financial activities, assets and other financial interests. There can be perfectly sound explanations as to how assets may have been acquired and how a life style is funded.
With the new agreements that the UK Government has recently signed up to with other countries HMRC will be receiving a lot of information relating to offshore interests. It is very likely that HMRC will be making use of this information and we can expect to see more enquiries because of this.
To deal with some enquiries then professional help and advice will be required. The sooner that contact is made then the better placed you will be to deal with any enquiry and pay the right amount of tax, penalties and interest.
How We Can Help
We have experience in dealing with HMRC tax investigations and will be happy to help. As always you can contact us to discuss any issues raised above or any other Tax queries you have.