The following Owner-Managed Businesses guidance note by Tolley in association with Guy Smith of inTAX Ltd provides comprehensive and up to date tax information covering:
Campaigns are targeted disclosure opportunities for selected groups of individuals, traders and professionals to make declarations of any undeclared income and over-claimed expenses.
HMRC charges financial penalties on disclosures that give rise to additional tax.
Although sometimes referred to in the media as ‘amnesties’, campaigns are not an opportunity to avoid, evade or pay less tax as the term amnesty suggests, but an opportunity to pay a lower penalty on any additional tax resulting from a disclosure.
During an enquiry or other compliance check, the penalty chargeable is based on the behaviour of the entity involved (the individual or business), the type of tax involved and whether it relates to an offshore matter, the quality of the disclosure, and whether the disclosure is completely unprompted or prompted by HMRC action. The maximum penalty chargeable under these conditions can be up to 100% of the additional tax; so in simple terms, if £10,000 is owed in tax, HMRC can charge a £10,000 penalty.
During campaigns, however, HMRC encourages disclosures by offering beneficial penalty terms. The terms can vary between different campaigns, but are typically much lower than would be charged under more common HMRC activity.
Campaigns to date have included medical professionals, plumbers, internet traders, landlords, employees with a second source of income, credit card sales and individuals who have sold properties that are not their main residence.
The core objective of HMRC campaigns is to collect more tax in a cost-effective manner.
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