TaxAdministrationJail threat for advisers who refuse to co-operate

Jail threat for advisers who refuse to co-operate

Third parties can be forced to answer questions about a £5,000 fraud

Tax advisers could be jailed for refusing to answer questions about serious
fraud cases, under new powers that took effect on Saturday.

The powers, contained in the Serious Organised Crime and Police Act 2005,
mean HM Revenue & Customs and the new Serious Organised Crime Agency can
force third parties to answer questions where they believe that a fraud has been
committed over the value of £5,000.

The new powers can be exercised on the say-so of the HMRC prosecution office,
the independent prosecution unit that deals with tax cases.

Up to now, third parties could not be required to answer questions put to
them in the course of an investigation by HMRC.

Experts at McGrigors, the law firm, said the move was rushed through before
the general election and not subject to wide scrutiny.

James Bullock, head of tax litigation and regulatory at McGrigors, said:
‘Targeting serious organised crime is a laudable intention, but the act also
contains a sweeping extension to the information-gathering powers of the tax
authorities with minimal scrutiny and draconian penalties for non-compliance.’

Advisers, as well as IFAs and bankers, could find themselves doorstepped and
forced to answer questions on the spot. If they fail to comply, they face up to
51 weeks in prison and/or a £5,000 fine. False or reckless responses attract a
possible sentence of two years, and/or an unlimited fine.

A spokeswoman for HMRCPO said the use of the powers were conditional on the
outcome of the HMRC powers consultation.

Related Articles

LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

1d Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

2w Emma Smith, Managing Editor
HMRC issues updated Trusts Registration Service guidance

Administration HMRC issues updated Trusts Registration Service guidance

2w Emma Smith, Managing Editor
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

2m Emma Rawson, ATT Technical Officer
‘Improve rather than lose’ disincorporation relief, tax body urges

Administration ‘Improve rather than lose’ disincorporation relief, tax body urges

3m Austin Clark, Reporter
Are you ready for the Trusts Registration Service?

Administration Are you ready for the Trusts Registration Service?

3m Helen Thornley, ATT Technical Officer
Advisers bullish despite Brexit concerns

Accounting Standards Advisers bullish despite Brexit concerns

1y Fraser Simpson, Reporter
Brexit: Five questions accountants should be asking

Accounting Firms Brexit: Five questions accountants should be asking

1y Fraser Simpson, Reporter