Penalties for Incorrect Tax
The aim of every tax inspector in every tax enquiry is to get you to pay more tax than you declared. Then they also want to charge you a "tax-geared" penalty. That can be up to 100% of the extra tax. Where the evaded tax is linked to an offshore bank account or asset the penalty can be up to 300%!
Tax officers will charge penalties on extra tax due, as a result of their tax investigation, if they believe an error occurred as a result of "careless" or "deliberate" behaviour. Voluntary disclosures get lower penalties. If Her Majesty's Revenue and Customs believe the error was deliberate and no voluntary disclosure was made the penalty range is a minimum of 35% (and more usually 45%, if the tax relates to years over 3 years before any disclosure), and a maximum of 70% of the additional tax. Serious tax fraud can have a penalty range of 50% (and more usually 60%) to 100% of the extra tax. Since October 2018 the maximum penalty in cases with overseas links, such as an offshore bank account, is 300% of the previously undeclared tax: plus in some cases 10% of the value of the offshore asset! More information about the new harsher penalty regime for Offshore Interests can be found on our page dealing with Offshore Disclosures.
The taxman also has a couple of worrying other punishments in his armoury. In the case of deliberate fraud, where over £25,000 is paid to HMRC and the taxman is not happy with the level of co-operation and disclosure, taxpayers can face "naming and shaming". HMRC can publish details of the taxpayer: including information about name, address and the amount of tax evaded. This Tax Offenders register will remain public for a year, and HMRC will actively encourage local papers to print stories. This can have a very adverse affect on suppliers and credit ratings. HMRC also have their own version of tagging. Its "Managing Serious Defaulters" programme means that anyone caught fiddling their tax could face intrusive follow up scrutiny - for the next 5 years, after the initial tax investigation has ended.
How can Lynam Tax Enquiry Experts help me get a lower penalty?
Lynam Tax specialists are experts in tax penalty negotiations. We have over 90 years' of experience in negotiating tax penalty levels, and can use our expertise to substantially reduce, and sometimes eliminate, the penalties that the tax inspector is demanding. We have helped hundreds of taxpayers achieve substantially lower penalties than those first sought by the taxman; including zero penalties in many cases.
NB. If you, or your client, are facing tax geared penalties Lynam Tax Enquiry Experts can help. The earlier in a tax investigation or dispute you involve us the more we can potentially save you: in tax, interest, penalties - and general grief and hassle.
For a free, confidential and no obligation discussion call Paul Lynam today on 0845 643 9997
or email firstname.lastname@example.org
PS: In some cases we can help you qualify for the latest tax amnesty terms and so get reduced penalties.
Lynam Tax Enquiry Experts HELP ME?
- Offshore Bank Disclosures
- Contractual Disclosure Facility/ COP9
- Appeals / Tribunal Hearings
- Worldwide Disclosure Facility: Tax Amnesty
- Fraud Investigation Service
- Rental Income Tax Enquiry
- Business Tax Enquiry
We specialise in managing all Tax Enquiry, Tax Disclosures & Tax Disputes with HMRC.
We will help you throughout the Tax Investigation or Disclosure and save you money, so you can concentrate on running your business and enjoying your private life.
For a helpful, sympathetic, confidential and no obligation discussion: