HMRC target cash based trades

HM Revenue & Customs are launching three new campaigns, indicating that there will be no let up on tackling tax evasion in 2012. HMRC have revealed that they will be targeting ‘home improvement trades’ such as builders, roofers, bricklayers, those who make money from direct selling through ‘party plans’ sales and direct sales through hand delivered catalogues.

These changes come after the success of the recent plumbers ‘tax safe plan’ which saw 9 arrests in the second half of 2011 and put hundreds of other plumbers under investigation for “less than watertight finances”.

HMRC has also used this to reaffirm their previous announced plans to launch campaigns targeted at electricians and those that trade on e-marketplaces such as Ebay, both of which are intended for launch before the end of March. These are in addition to on-going campaigns targeting tutors and coaches and completed campaigns aimed at plumbers, medics and offshore account holders.

They have also announced that they will be targeting those in higher income tax brackets who should be reporting additional income but fail to complete tax returns.

These campaigns are being used as a statement from the government, to show that through these initiatives to fight tax avoidance, evasion and fraud they get around £7 million back in unpaid taxes.

If you’re unsure or worried that you have underpaid tax, whether it is deliberate or in error and regardless of whether your business is in the sights of the new campaigns or not, you should look to get professional advice and bookkeeping assistance as soon as possible. HMRC will generally give less severe penalties to taxpayers who voluntarily come forward to put their affairs in order.