Consultants, doctors and other medical professionals have been encouraged under the new initiative from HM Revenue & Customs (HMRC) to ‘come clean’ if they have understated income. Those who contact HMRC by 31 March 2010 to make what is termed as a voluntary disclosure will be able to put their tax affairs fully in order simply and on the best available terms. In common with other recent disclosure opportunities, any tax geared penalty will be limited to 10 per cent of the tax liability, except where an offshore account is involved and no disclosure was made under the previous off shore amnesties. No penalty will be charged where the tax liability is less than £1,000.
After 31 March 2010 HMRC are threatening to carry out targeted investigations against those medical professionals who have not yet come forward. In the more serious cases a failure to cooperate could result in substantially higher penalties or even criminal prosecution against those who have undeclared liabilities.
This latest initiative comes hot on the heels of HMRC’s first and second ‘tax amnesties’ in respect of offshore bank accounts - the Offshore Disclosure Facility. These earlier initiatives proved to be a 'cost effective' way of flushing out tax avoidance and collecting unpaid tax liabilities, so HMRC has decided to offer medical professionals a similar opportunity to come forward and declare untaxed amounts before it proceeds to carry out investigations using the information it is gathering. We understand that the areas that may involve unpaid taxes include; the validity of some business expenses, the use of locums, staff accommodation and the status of workers.
In fact HMRC are likely to broaden the scope of their current initiative to include other professionals such as Lawyers, Barristers, Dentists, Architects and Accountants!
Please contact your usual Robson Taylor advisor or else speak to our tax partner Stephen Fox on 01225 428114 or Email s.fox@robsontaylor.co.uk if you have any queries or require advice in relation to this latest tax initiative.
For more information on the Tax Health Plan HMRC have produced the following advisory papers on their website:
£ Making a disclosure
£ £ Completing the disclosure forms
£ £ £ Frequently asked questions
Date:25 January 2010
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