HMRC confirms probe into 153 people suspected of aiding tax evasion

HMRC has confirmed it is investigating 153 suspected 'enablers of tax evasion, including unregulated tax advisers.

Cracking down on 'enablers of tax evasion has been a critical area of focus for HMRC since it established its Fraud Investigation Service in 2015.

Law firm RPC told City A.M. (newspaper)

• HMRC's Fraud Investigation Service has been given additional resources to recruit more staff, and, as a result, the number of investigations into tax fraud enablers is likely to increase.

The definition of 'enablers.'

• The definition of 'enablers' is broad and includes wealth managers or technology companies that provide software that could potentially be used to distort profits, enabling businesses to evade tax.

Knowingly complicit vs not aware

1. Enablers fall under two categories:
   • Those who are knowingly complicit in criminal activity and
   • Those who may not be aware of their client's involvement in criminal activity but have failed to carry out proper risk assessment checks.
2. RPC explained that
   • Professionals cannot rely on traditional financial crime controls and must continue to monitor and 'refresh' their risk assessments on a regular basis.
   • As authorities become better at tackling traditional methods of tax evasion, criminals are becoming increasingly dependent on assistance from enablers. This assistance includes:

                   -Moving assets between jurisdictions,

                   -Setting up offshore structures,

                   -Concealing beneficial ownership and

                   -Devising arrangements to minimise profits.

    3. Adam Craggs, Head of Tax Disputes and Partner at RPC.

• "HMRC is determined to clamp down hard on anyone who aids in tax crimes, not just the perpetrator themselves,"
• "The Revenue has been effective in identifying traditional tax evasion, with the result that would-be evaders are becoming more sophisticated and are increasingly turning to third parties to assist them,"  

   4. Michelle Sloane, also a partner at RPC, added that:

• "HMRC has broadened its focus considerably and is now coming after a wide range of enablers who it considers are complicit in tax evasion."
• "This includes software developers and even those who operate storage facilities that could be used to hide high-value goods.
• If you are in any way assisting clients evade tax, HMRC may use its criminal powers against you,"  

READ HERE

• https://www.cityam.com/hmrc-confirms-probe-into-153-people-suspected-of-aiding-tax-evasion/