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HMRC could seize late tax from accounts

06/07/2007  11:06:58

 


 

The HM Revenue and Customs (HMRC) has proposed controversial measures that would allow money owed by taxpayers to be taken automatically from their bank accounts.

This would eliminate the need for the HMRC to pursue people through the courts to get hold of the tax payments due to them.

The recently released consultation paper insists: "Taxpayers who owe money [to HMRC] frequently have sufficient funds or assets to pay their debts, but choose to delay doing so."

HMRC figures indicate that as of March 2006, around £22 billion in unpaid tax remained outstanding.

Of that sum, it said around £1.2 billion was attributable to unpaid funds from UK and offshore companies.

This is despite the fact that the huge majority of tax payers - some 95 per cent - do make their payments on time.

Concerns have been expressed regarding the proposed measures and how such action by the HMRC might be regulated.

John Whiting, sub-committee chairman of the Chartered Institute of Taxation, told the Channel Register that although the proposals "are reasonable as a concept, the issue is safeguards. The Revenue wants its powers and we want our safeguards in return".

A recent offshore tax amnesty by HMRC led to around 60,000 choosing to declare unpaid tax on offshore bank accounts.

However, it is thought that some 40,000 people have still not paid the appropriate tax - and could now be in line to receive fines of up to 100 per cent.


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Information on offshore companies and offshore corporate structuring is available on several sections of this site. Incorporation and company law information is available in the offshore companies section. Specific information can be found on the relevant jurisdiction page. Further information is available on our excellent Tax Cafe publications. Related topical news stories can be found on this page.

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