HMRC Tackles Tax Avoiding Lawyers

HM Revenue & Customs (HMRC) is taking on lawyers who are avoiding tax in a new high-profile campaign.

Solicitors are invited to volunteer any undeclared earnings in return for discount penalties.

HMRC says the campaign is intelligence led and that they have details of undeclared income about solicitors.

The campaign is open until March 9, 2015 for solicitors to notify any tax irregularities. They then have until June 9, 2015 to file tax returns and pay any tax due.

Caroline Addison, Head of Campaigns, said: “We have identified a number of solicitors who are not declaring the right level of income or paying the correct tax. This is their chance to come forward and square up their financial affairs.

“If they do, they will get the best penalty terms we can offer.

£1 billion recovered

“If we have to go after them when the campaign closes, the penalties will be much higher.”

Once the campaign ends, tax penalties can rise to 100% of the tax owed plus surcharges and interest. In some cases, the matter could lead to a criminal prosecution.

HMRC has already recovered more than £1 billion in undeclared tax from a series of campaigns encouraging taxpayers to make voluntary disclosures.

Other professionals and trades involved in campaigns include doctors, plumbers, tutors, online traders and landlords.

Solicitors can volunteer to take part in the campaign by calling 0300 013 4749 or visiting the HMRC web site

Social workers warned

Meanwhile, HMRC has also launched a campaign to find locum or independent social workers claiming they are employed by their own companies when they are really working for someone else.

HMRC says that due to the day-to-day management of social workers, many independents are falsely self-employed to evade tax and national insurance.

“The problem is the supervision and control these social workers are subject to,” said Samantha Hurley, of the Association of Professional Staffing Companies.

The association is advising social workers to give up their companies and work for an umbrella company or directly for their employer, otherwise HMRC may consider they are avoiding tax.

Social workers employed by their own company are probably subject to IR35 tax rules, says the association, and as such may find HMRC launches a tax investigation into their financial affairs.