HMRC targeting off-shore tax evasion

off-shore tax evasion

9th November 2017

HM Revenue & Customs (HMRC) is certainly stepping up its game in the fight against tax evasion following criticism of its performance to date. We’ve mentioned the numerous reports in recent weeks of new ways the authority is tackling fraud, from psychological profiling to introducing new legislation in the form of the Criminal Finances Act 2017. In its latest move, HMRC has set its sights on off-shore evasion.

Off-shore tax evasion in the firing line

As part of its ‘No Safe Havens’ campaign, HMRC introduced new criminal offences which applied as of 7th October this year. Aimed at those with income or gains from outside the UK who evade income tax or capital gains responsibilities in the country, the new offences remove the need for the authority to prove that this activity was intentional.

In essence, this means that HMRC can prosecute those failing to correctly declare offshore income, even if it was the result of an error rather than deliberate evasion.

A simple mistake could be costly

Under this new offence, wrong-doers could find themselves facing harsh penalties or even jail time of up to 6 months, with the potential of a year-long prison sentence expected to be introduced in due course.

For anyone operating across borders, this move to criminalise evasion even if it has occurred out of error will certainly add another level of stress to an already taxing prospect. Managing off-shore income and gains is a complex field and mistakes can easily be made by those without the experience and knowledge needed to remain fully compliant.

And for recruitment firms placing contractors overseas, the knowledge that they can also find themselves under fire due to the fraudulent activity of partners and candidates under regulations outlined in the Criminal Finances Act 2017 is just another risk to be managed.

Speak to an expert

Now really is the time for recruiters to get an expert team on board to ensure they don’t fall foul of the many international tax authorities that are becoming better equipped as the fight against global tax evasion continues. If you want to ensure you have a fully compliant contractor management solution in place that keeps your firm on the right side of the law, contact our expert team today.


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