It’s pay-up time for 3,000 West Midlands tax avoiders…
3,000 West Midlands businesses and residents who bought into tax avoidance schemes now know that the taxman will be demanding – and taking – the money they’ve “saved” within the next three months.
Her Majesty’s Revenue & Customs (HMRC) has now published a list of 1,200 tax avoidance schemes for which it will be applying new powers to demand payment within 90 days: https://www.gov.uk/government/publications/tax-avoidance-schemes-on-which-accelerated-payments-may-be-charged-by-hmrc
Andrew Browne, Head of tax at Britain’s fastest growing accountancy firm, Bishop Fleming, which has an office in Worcester, said: “This will now become the latest miss-selling scandal, with the buyers of those tax avoidance schemes claiming against the professional indemnity insurance of the profession advisers who sold them those schemes.
“Unfortunately, many of those advisers are accountancy firms that were lured by commission payments from the creators of these tax avoidance schemes. This raises the danger of professional indemnity insurance premiums rising for the majority of accountants, like us, who refused to sell these dubious products”, said Mr Browne.
Nationally, it has been estimated that HMRC’s list of 1,200 targeted tax avoidance schemes puts more than 33,000 individuals and 10,000 companies on notice to pay many millions of pounds in taxes within the next 90 days.
“Most publicity has focused on the celebrities who have been drawn into these tax avoidance schemes: but that hides the huge number of well-heeled ordinary individuals and cash-rich businesses that have also been persuaded to buy into a ‘clever formula’ for avoiding tax.
“This could put many of those individuals and businesses into bankruptcy”, warns Bishop Fleming’s Andrew Browne.
“New powers, expected to become law within weeks, will enable HMRC to demand full payment within 90 days of the tax they calculate to be owed from these schemes. It could take up to ten years to determine whether any of those 1,200 schemes is actually legitimate.
“This is a classic lesson for tax-payers, and for their professional advisers. If a tax scheme looks too good to be true, it almost certainly is!”, said Mr Browne.
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