Partner Article

The taxman targets solicitors

There are fewer than two months for solicitors to review their affairs following a new HM Revenue & Customs (HMRC) Solicitors’ campaign being launched. The campaign will offer solicitors, who have not declared all of their income, whether through tax evasion or for other reasons, the opportunity to bring their tax affairs up to date, warns Smith & Williamson, the accountancy and investment management group.

This follows several successful tax disclosure campaigns over the last two years, which has allowed those within certain trades or professions to make a disclosure of historical undeclared taxable income under favourable terms.

Andrew McKenna, partner and head of tax investigations at the Manchester office of Smith & Williamson said:

“HMRC campaigns are launched for groups of taxpayers where HMRC suspects a high risk of tax error or evasion and to date they have produced £305m. Now, it’s the solicitors’ tax campaign; perhaps a surprising category of professionals but this highlights that incorrect tax returns can emerge from any part of the spectrum of businesses and professions.

“HMRC has information, for example Legal Aid Payments, which they can, in due course, compare to a solicitor’s submitted self assessment record, looking for inconsistencies.

“Before HMRC starts looking into information and commencing tax enquiries, they have offered a limited disclosure window to allow solicitors with historical tax failures to come forward voluntarily. This disclosure window runs until 9 June 2015, but notifications of intention to disclose have to be made by 9 March 2015.”

“Any solicitor who has not fully declared their taxable income for any of the last 20 years needs to carefully consider taking up this opportunity.”

If solicitors with undeclared income do not come forward, it is expected that after the campaign HMRC will utilise the substantial amount of information on solicitors’ that HMRC possesses to follow up cases, with a risk of prosecution where there is tax evasion.

This was posted in Bdaily's Members' News section by Smith & Williamson .