Plumbers, whose tax affairs threaten to burst open, could yet save themselves from a big bill, according to an expert at helping plug such leaks.
Graham Apperley, taxation director at the Midlands office of national audit, tax and advisory firm Crowe Clark Whitehill, said there were still opportunities to own up to HM Revenue & Customs and get favourable treatment despite closure of the Plumbers Tax Safe Plan (PTSP), a chance for plumbers, gas fitters and heating engineers with undeclared taxable income to “come clean”.
His warning follows the arrest of five plumbers in tax raids and investigations into 600 others.
Under PTSP plumbers had until May 31 to notify the authorities that they would be making a disclosure, and August 31 to pay up – tax, interest and penalties.
However, although the guarantee of terms within the PTSP are no longer on offer, HMRC has left the PTSP disclosure route open for plumbers, and indeed those in other trades, who have still not come forward.
Mr Apperley said: “In broad terms the PTSP offers a ten per cent penalty in many cases (maximum 20 per cent) and the requirement to settle arrears for only six years rather than the 20 years that HMRC can go back in cases of fraud.
“HMRC recently announced that five plumbers had been arrested in tax raids. In addition, around 600 are under civil investigation because, it is considered, they have failed to pay the right amount of tax. More raids are expected to take place over the coming weeks across the UK.
“This is the tough side of HMRC’s campaigns. Campaigns and disclosure opportunities are designed to encourage people to come forward voluntarily and sort out their tax affairs. However, HMRC has always said it will come down hard on those who choose not to do so despite having undeclared tax, and that it will use its information sources to identity such people.
“HMRC has in the past been criticised for not giving its campaigns ‘teeth’ by being seen to take tough action against tax evaders. Clearly this is changing.
“Mike Wells, director of HMRC’s Risk & Intelligence Service, recently declared – ‘These arrests are just the start. HMRC is considering hundreds of further cases for criminal investigation. Some people may have thought we were bluffing when we said we have information that we will use to prosecute tax evasion’.
“The message is stark. Those plumbers who may have thought HMRC was a wet blanket are in danger of being all washed up unless they act quickly.”
