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Tax Tip

09/06/11 The review of money laundering rules may benefit smaller companies.

The Government has been consulting on changes to the Money Laundering Regulations 2007, which could see the very smallest firms granted exemption from the regulations.
The Money Laundering Regulations 2007 require firms to put in place policies, procedures or systems in order to prevent money laundering or terrorist financing.
The consultation will run from 7 June until 30 August 2011. Views are sought in order to develop a robust impact assessment and ensure the proposals contribute to a more effective and proportionate regime.
The new consultation document suggests that the 'tick-box' approach adopted by some firms to the regulations should be replaced with a more risk-based policy. Instead of a blanket set of guidelines and checks, firms would be allowed to make their own assessment of the risks they face and to implement their own systems and controls according to circumstance and the level of that risk.

The Treasury has said that it welcomes proposals to exclude businesses with VAT-exclusive turnovers of below £13,000 from the checks, or at least to reduce the requirements placed on them.

Tonmoy Kumar, Manager of the Accounts Department of ABDS says:
“the 2007 regulations are there to prevent money laundering and possible terrorist financing, but the regulations could be more effective and proportionate by removing a range of criminal penalties on all businesses and by lifting the burdens on the smallest businesses. “

We will report further after the consultation closes on 30 August.

If you need any help and advice on this or a similar matter don’t hesitate, contact Lavinia Newman, Stuart Coleman or Tonmoy Kumar NOW to discuss how ABDS can help in all your financial planning and business advice.
ABDS of Southampton, for all of your Tax Planning, Compliance and Tax Returns.

Tel: 023 8083 6900  E-mail:

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