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News - 13 April 2013

HMRC to keep up the pressure on tax defaulters.

HMRC introduced a new monitoring programme against serious tax defaulters.

The new scheme extends the criteria of defaulters who may be subject to enhanced monitoring of their tax affairs. They are now persons who have been:

  • Successfully prosecuted for a tax matter or have had a civil evasion penalty imposed
  • Charged a penalty for deliberate misconduct under taxes legislation
  • Required to give security as a guarantee against future default
  • The subject of successful recovery action by an insolvency practitioner
  • Identified during a civil fraud investigation as being of a continuing high risk

HMRC will write to people who are likely to be put on the scheme. There is no appeal, but rights to complain against unfairness remain. The monitoring will vary according to the circumstances of the default but will involve, at least, meeting all the usual obligations of timely, accurate returns or registrations. Requests for fuller information will also be likely, for example a full balance sheet.

Stuart Coleman, Manager of the Tax Department of ABDS comments:
“There is no minimum value which has to be met before monitoring can occur but plainly HMRC’s priority will be the more serious cases of prior misconduct. The monitoring process will last until HMRC are satisfied that there is no longer a high risk of diahonesty or of deliberately getting tax affairs wrong.”

Monitoring can apply to a business provided it is a serious defaulter and can extend to the individual directors or officers of a company and individual partners in a partnership provided they are also serious defaulters. If a business ceases to trade then monitoring can occur on the individuals behind the business. Likewise, for successive businesses where the old business was guilty of any of the defaults mentioned above.

If you are unsure and need any help and advice on IR35, Self Assessment, Corporation tax, PAYE, or you need to keep abreast of changes in legislation and how it could impinge upon your business, contact Lavinia Newman, Stuart Coleman or Tonmoy Kumar to discuss how ABDS can help

ABDS Chartered Certified Accountants of Southampton.
Tel: 023 8083 6900  E-mail:

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