HM Revenue and Customs (HMRC) have today published the names of deliberate tax defaulters on their website.
This action is a part of HMRC’s approach to combat tax evasion and non-compliance and to ensure that everyone pays their fair share as well as to create a level playing field for honest people and businesses by cracking down on the minority who seek to evade tax.
HMRC has been given this power to publish names in its attempt to deter UK taxpayers from deliberately defaulting on their tax obligations. It also aims to encourage the non-compliant to make a full disclosure at the outset of an investigation as doing so means their details will not be published.
David Gauke, Exchequer Secretary to the Treasury, said:
“HMRC is dedicated to clamping down on the small minority of people who break the law, and finding and taking action against tax cheats who try to evade their responsibilities. The publication of these names sends a clear signal that cheating on tax is wrong and reassures people who pay their taxes – the vast majority – that there are consequences for those who refuse to tell HMRC about their full liability. It also encourages defaulters to make a full and prompt disclosure and cooperate with HMRC to avoid being named.”
Details of the first tranche of deliberate defaulters can be found at the website of HMRC and it is intended that this list will be updated each quarter.
A deliberate defaulter is a person who incurs a relevant penalty for:
- an inaccuracy in a return or document for a tax period beginning on or after 1 April 2010,
- a failure to comply with certain obligations, such as the obligation to notify HMRC of a liability to tax, or
- a VAT or excise wrongdoing that occurred on or after 1 April 2010.
Deliberate defaulters can be named where, during an investigation into a period starting on or after 1 April 2010:
- it is established that the taxpayer is liable to a penalty for a deliberate default, and
- as a result of the deliberate default, more than £25,000 of additional tax would have been lost without HMRC’s intervention, and
- the taxpayer has failed to make a full disclosure to HMRC at the outset, so failing to receive the maximum possible reduction in penalties for full and early disclosure and assistance.
There is a legislative requirement for HMRC to ensure it publishes names for only 12 months.
Details are published only once all appeal routes against the related tax and penalties are exhausted. Details must be published within 12 months of the penalty becoming final.
Legislation to allow HMRC to publish the details of deliberate tax defaulters was introduced in Finance Act 2009.
