Time is ticking away for taxpayers who have failed to complete tax returns in the past to take advantage of a new HM Revenue & Customs (HMRC) initiative, which could result in tax investigations if they do not come forward voluntarily.
The three-month Tax Return Initiative, which was launched in July, is particularly aimed at people liable to pay tax at rates of 40 per cent or 50 per cent who were asked to submit a self assessment tax return for the financial year 2009-10 or earlier, but did not do so. The initiative is also available to any taxpayer with tax returns to submit to HMRC for these years.
They have until 2 October to tell HMRC they want to take part, submit completed returns, and pay the tax and national insurance they owe. By coming forward voluntarily, they are eligible for better terms, and any penalty they may need to pay will be lower, than if HMRC has to pursue them and carry out a tax investigation of their financial affairs.
After 2 October, if taxpayers have not submitted their tax returns and paid what they owe, HMRC will use its powers to pursue outstanding returns along with any unpaid tax and national insurance. Penalties of up to100 per cent of the tax due or even a criminal investigation could follow as a result.
As with any tax investigation matter, it is important to act sooner rather than later. Anyone who is unsure of their tax liability or what action they need to take would be wise to contact tax investigation specialists, like Taxation-Investigation, the dedicated service from Salhan Accountants in Birmingham, as soon as possible.
Taking expert advice at an early stage will help taxpayers to put tax affairs in order at an early stage, rather than waiting for HMRC to come calling at a later date, with the possibility of a detailed tax investigation.
A similar HMRC initiative, the Medics Tax Health Plan (THP) campaign, which closed in June 2010, raised more than £10 million in previously unpaid tax following disclosures by taxpayers, including one individual payment of over £1 million by a doctor and one of over £300,000 by a dentist.
Subsequent tax investigations have allowed HMRC to identify and target those they believe should have used the THP campaign to make a disclosure but who chose not to do so.
To date this has meant more than 1,000 civil investigations have been started and action targeted at those who should have come forward has recovered another £3.1 million in unpaid tax.
Although the terms offered by the Tax Health Plan are no longer available, doctors or dentists can still volunteer now to co-operate with HMRC. Any doctor or dentist unsure about the best way forward would again be wise to seek expert tax investigation advice, from specialists like Taxation-Investigation, to clarify their options, establish the best way forward and to assist in mitigating the outcomes.
