The Taxman can raid tax evaders’ bank accounts

Did you know that HMRC has been given sweeping new powers to raid bank accounts and cash ISAS to recover outstanding tax debts?

The Chancellor, George Osborne, gave the green light for this new move, meaning that anybody who refuses to pay money owing to HMRC can now have the cash taken directly from their bank accounts.

Around 17,000 people who owe an average of £6,000 could be targeted each year.

This move is part of a major Government crackdown on tax evasion but has been widely criticised, so HMRC has been forced to introduce a number of safeguards.

Government crackdown on tax evasion safeguards

• People targeted must always have at least £5,000 left after any raid on their accounts
• Every debtor will first be asked to attend a face-to-face meeting with a tax official, and can go through a county court appeal process

These safeguards were introduced after claims that any mistakes could mean innocent and vulnerable people could be unfairly targeted.

The Taxman can raid tax evaders’ bank accounts

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HMRC cracks down on business tax evaders

Business raids have risen quite dramatically in a bid from the HMRC to crackdown on tax evasion to meet their 1165 prosecution target – in fact, nearly 600 properties have been raided this year so far.

According to research from Pinsent Masons, this figure is nearly treble the amount of raids that have been carried out over the past four years.

Nearly 600 properties were raided this year as HMRC pursues its target of 1,165 tax evasion prosecutions over the course of 2015.

The number of tax evaders who have gone to prison as result of tax evasion has risen by around a third over the last four years, with the average sentence length falling by around 60% over the same period.

These facts suggest that HMRC is now making better use of its powers to prosecute and also pushing for custodial punishment in a wider range of cases, according tax director at Pinsent Masons, Paul Noble.

Noble said;

"An increase in the number of raids conducted and custodial sentences meted out for tax evasion reflect the fact that HMRC is now casting its net wider. It is no longer focusing narrowly on HNWIs and those guilty of the most serious evasion. It is targeting a broad range of taxpayers and refusing to let those suspected of more minor offences slip through the cracks.

"Raids on premises are often an essential means of gathering evidence that is needed in cases dealt with for prosecution. It is labour-intensive work but needed in such investigations. A non-criminal tax enquiry is much more cost effective but does not always send the deterrent message HMRC wish to convey."

If in doubt, check it out! Omni Chartered Accountants are here to help with any tax or accountancy advice that you have – contact us on 01902 837 408 or request a free of charge call back from our website www.taxandacountancysolutions.co.uk.