Tax Taskforce Targets Covid-Support Frauds

The Government has issued a policy paper summarising actions being taken to recover incorrect and fraudulent claims under the various Covid support schemes.

HM Revenue and Customs have set up a £100m “Taxpayer Protection Taskforce” comprising 1,200 officers to combat fraud connected to Covid-19 support payments. HMRC report that 13,000 fraud and error enquiries were opened in 2020/21. The tax office wrote to 75,000 people. So far they have stopped or recovered £743m of overclaimed grants. The Tax Taskforce is expected to recover £1.5bn from fraudulent or incorrect payments by end 2022/23.

The government is working with the British Business Bank, lenders, and various enforcement authorities to recover Bounce Back Loans (“BBLs”) obtained fraudulently. They are supported by the Cabinet Office Counter Fraud Function to identify the level and types of fraud against the scheme, helping lenders tackle fraud effectively.

The government is working with enforcement bodies such as the National Investigation Service (“NATIS”) to investigate the most serious cases of fraud: and are emphasising that anyone who defrauds the scheme is at risk of prosecution. To date, NATIS have arrested 49 people in connection with Bounce Back Loan Scheme fraud. Work by the National Crime Agency has resulted in a further 17 arrests. HM Government has injected over £6 million into NATIS to tackle Covid loan scheme frauds. And in relation to BBLs, the Insolvency Service has already secured: 106 director disqualifications; 48 bankruptcy restrictions; and 13 companies have been wound up.

What does this mean for me?
If you made any claims under the Covid support schemes: you should take steps to check that all of the claims are valid. If any errors are spotted, they should be reported to HMRC as soon as possible. You will also have to repay the overclaimed grant. Penalties are chargeable, but these can be reduced substantially in cases of high-quality and early disclosures. A failure to make a disclosure, or an incomplete disclosure, significantly increases the risk of prosecution.

How can Lynam Tax Disclosure Experts Help?
Lynam Tax Specialists have a vast amount of experience in dealing with disclosures to HMRC and investigations by the taxman: including enquiries into the CJRS, Bounce Back Loans, and other Covid-19 support schemes. We can help review your situation, manage any necessary disclosures, reduce the chance of you going to prison, and get you massively lowered penalties.

For a free initial consultation call today:
Paul Lynam: 0845 643 9997
Andrew Nutbrown: 0771 877 8710