Small-business owners and self-employed workers who fail to submit tax returns are among those being put under the microscope in a new tax clampdown by HM Revenue & Customs (HMRC).
The UK tax body has announced five new sectors across the UK that it’s planning to target to ensure businesses are paying tax ― including scrap-metal dealers and fast food outlets in Scotland, as well as small building firms in the North West.
Taxpayers failing to submit their corporation, PAYE, self-assessment and VAT returns in the South East will also be scrutinised.
According to HMRC, specialist teams will be focusing on “high-risk areas” to uncover those who were evading tax by inflating expenditure or under-reporting income. Penalties would be severe, it said.
“HMRC is clear — if you deliberately seek to evade tax we can and will track you down and you’ll face not only a heavy fine, but possibly a criminal prosecution as well,” said HMRC director general of enforcement and compliance Mike Eland.
The taskforce is part of a wider campaign to seek £7 billion of extra income each year for the Government by 2015, by tackling tax evasion, avoidance and fraud.
Previous campaigns by HMRC have focused on dentists and the restaurant trade. Further campaigns are to be announced early next year, with more expected in 2013.
An HMRC spokesman said that firms “had no need to worry” as long as they were correctly declaring income and paying the right amount of tax. Anybody in doubt as to whether they needed to submit a tax return or not should check with HMRC, he said.
Serious offenders risked heavy fines, he said: “Penalties can reach as much as 100 per cent of the lost revenue if the inaccuracy is deliberate.”