A plumber from Hampshire was sentenced today for tax evasion; following a number of HMRC investigations targeting plumbers, gas fitters and heating engineers who did not step forward during last year’s Plumbers Tax Safe Plan – the Plumbers’ Tax Disclosure Campaign.
HM Revenue & Customs tax investigators discovered that Peter David Mack had set up his own freelance plumbing business in 1997, but had never registered with HMRC, so paid no Income Tax, NIC or VAT. The tax inspectors estimated that over a 14 year period Mack evaded around £88,000 of Income Tax and VAT, plus interest: a total of £112,000.
Mack (then aged 59) was arrested at his home in Ringwood in July 2011. He was later charged with “Evasion of Income Tax, contrary to the Taxes Management Act 1970; Evasion of VAT contrary to the VAT Act 1994 and associated money laundering, contrary to the Proceeds of Crime Act 2002”. He pleaded guilty to £40,000 of tax fraud at Southampton Crown Court in April this year, and was sentenced today to a four month jail term, suspended for 12 months. Mack has recently paid £40,000 to HMRC. The taxman will seek to recover the rest of the money through civil proceedings. Mack must also pay £1,800 costs, and serve 100 hours of community service.
That is just one of a string of similar Tax Disclosure Campaigns (limited Tax Amnesties) aimed at selected groups as part of a rolling programme by the taxman to encourage tax evaders to “join the club”. Campaigns launched so far have targeted offshore investments, medical professionals, plumbers, VAT defaulters, coaches & tutors, electricians and online traders. HMRC claim that more than £500m has been raised from voluntary disclosures, and a further £105m from follow-up tax investigations. Plumbers, gas fitters and heating engineers who came forward under the Plumbers’ Tax Disclosure Campaign have already paid over £4m in outstanding tax. HMRC continue to launch tax enquiries into those who have not declared their correct tax position. Once a Tax Disclosure Campaign closes, taxpayers who have not come forward but are found to have unpaid tax liabilities could face higher penalties, rising to 200% of the tax unpaid or, potentially, criminal prosecution.
Commenting on this case, the taxman said: “It really is better for people who owe tax to come to HMRC, before we come and find you.”
Lynam Tax Investigation Experts have a vast amount of practical experience in managing serious tax fraud investigations. If you are worried about a tax investigation we can advise you on the best course of action. If appropriate, we can help you manage any necessary disclosures. If you are facing criminal charges we can help you obtain first class legal representation, in order to obtain the optimum outcome for you, your business and your family.
*For a free, private, no obligation consultation, call Paul Lynam today on 0845 643 9997