HMRC has launched a new campaign targeting white collar professionals as it continues its high profile clampdown on underpaid taxes. Solicitors are now being urged to come forward and voluntarily declare any unpaid tax before a June deadline or face hefty penalties.
Many accountants have reported to us that HMRC is broadening its range of targets. The Solicitor’s Tax Campaign, announced in December, is another reminder that HMRC is now scrutinising taxpayers from all walks of life. It is not focusing solely on those working in traditional cash-in-hand businesses such as electricians or taxi drivers.
As most accountants will know, HMRC now possesses sophisticated technology to justify its widening lines of inquiry. The 45 million database system “Connect” gathers real time data to help it identify groups where tax avoidance may be an issue. It draws data from multiple public and private sources, including: banks, local councils, Legal Aid data and even social media.
A notable proportion of solicitors are self-employed and it is the smaller, owner-managed practices which are likely to form the main focus of this particular clampdown.