David Pickstone comments on the 2015 Budget, focusing on the Government’s apparent plan to pursue those who they believe have evaded or avoided paying tax on their earnings.
Yesterday’s Budget clearly indicates the Government’s intention to continue to aggressively pursue those that they consider having in some way evaded or avoided paying what HMRC maintains is the “right amount” of tax.
The increased hostility to what was previously considered to be legitimate tax structuring is not going to drop down the Government’s agenda. Increased responsibilities being placed upon financial intermediaries to inform their UK resident customers with overseas accounts of their obligations to disclose under the Common Reporting Standard; the further expansion of the DOTAS regime, including the increase in penalties for those who do not comply; and the implementation of further legislation to target those the government consider to be “serial avoiders” of tax are all evidence of a crackdown on those who seek to reduce their tax bill.
The government’s stated goal is to recover £5 billion from tax avoidance / evasion. A large proportion of this will presumably come from accelerated payments on disputed tax liabilities and large interest payments on now very old liabilities. It is debatable whether the Government’s and HMRC’s approach to these historic liabilities is fair, as the end target is often an individual who thought (rightly or wrongly) that they were entering into a legitimate structure and are now in a very different financial position to the one they were in when they entered the schemes. More tax-driven insolvencies are likely to be on the agenda.
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