HMRC has recently published three consultation documents on measures to tackle the hidden economy. These cover:-
- An extension of HMRC’s powers on obtaining data;
- Making access to business services conditional on registration for tax; and
- New penalties and sanctions for those operating in the hidden economy.
The documents state that the UK’s hidden economy is comparatively small but emphasises the need to reduce it further.
The proposal is to introduce a condition that businesses must be able to prove they have registered for tax before they can gain access to certain business services such as insurance, business bank accounts, leases, etc.
Finally, there is a proposal to amend the existing ‘failure to notify’ penalty regime so that a second failure to notify attracts a higher penalty and also extend non-financial deterrents such as increased monitoring by HMRC.
Date: 30th September, 2016
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