The taxman has launched a groundbreaking tax amnesty initiative specifically targeted at medical and dental professionals, including Dentists, General Practitioners, Hospital Doctors, Surgeons and Consultants. The THP presents medical and dental professionals with a unique opportunity to make good any undeclared tax with only a 10% penalty. The programme will run from 11th January 2010 to 30th June 2010. To benefit from the advantageous terms of the THP, medical and dental professionals have to make a full disclosure of all under declared income and pay along with interest and a 10% penalty by 30th June 2010.
Why are Doctors and Dentists being singled out?
HMRC have used their extensive information powers to obtain data from a number of third parties, including NHS Trusts, insurance companies, private hospitals and pharmaceutical companies
What if I don’t disclose?
From April 2010 onwards, HMRC will carry out tax investigations aimed at medical and dental professionals who have not come forward, using their information. Failure to disclose tax irregularities could result in a tax enquiry. These can be time consuming and intrusive. Penalties can be up to100% of the tax evaded. The tax office can now also publically ‘name and shame’ individuals who decide not to participate in the THP. In some cases, HMRC may prosecute.
Key features of the THP:
- It is only open to medical and dental professionals, and specifically those regulated by the General Dental Council or General Medical Council and in possession of GDC or GMC Registration Numbers;
- To benefit from the favourable terms, individuals must make a full disclosure of all undeclared tax liabilities;
- Tax is due up to twenty years back;
- Registration of an intention to disclose under the THP must be made by 31st March 2010.
- Full payment of the tax, interest and penalties must be made by 30th June 2010;
- The penalty will be fixed at 10% of the unpaid tax;
- No penalty will be applied where the total of the unpaid taxes is less than £1,000, or in cases of innocent error, where the back tax may be limited to 6 and even as short as 4 years;
- Doctors and Dentists who make a full disclosure under the THP will not be publically ‘named’ and ‘shamed’;
- Where unpaid tax is linked to an offshore bank account, the 10% penalty arrangement may not be available;
- The taxman says no further opportunities will be given to dental or medical professionals to benefit from other tax amnesties;
- After 31st March 2010, HMRC will commence investigations based on the information they have obtained. If extra tax is due, the penalties will be much higher than the 10% on offer under the THP, and could be up to 200%. They are unlikely to be less than 30%;
- HMRC has not given any guarantee that a taxpayer will not be prosecuted. However, as long as the subject of the disclosure does not include the proceeds of serious organised crime, it is unlikely that HMRC would consider prosecution;
- An individual can make a disclosure under the Civil Investigation of Fraud (CIF) procedure. If CIF is offered to someone it comes with a guarantee of immunity from prosecution if the disclosure is correct and complete. The THP is not available to someone who discloses under the CIF procedure.
Do I need to consult a specialist?
The various tax amnesty processes are straightforward in simple cases. But there are many hazards for the unwary or those with more complex tax affairs. Badly handled Disclosures can have a negative effect; leading to higher penalties; a Civil Investigation of Fraud enquiry; naming and shaming; or in extreme cases, prosecution. Your usual accountant may be able to help. But sometimes a specialist consultant is required, rather than a general practitioner. Lynam Tax Enquiry Experts have vast experience of handling tax enquiries and disclosures to the taxman. In fact it’s all we do – because we are deep specialists.
For a free, no obligation, private consultation, don’t delay, call Paul Lynam today: on 0845 643 9997