Corporate offences guidance updated

Newsletter issue - June 2018.

HMRC's guidance on corporate offences for failing to prevent criminal facilitation of tax evasion has recently been updated to include information about self-reporting a company or partnership that has facilitated such an offence.

All corporate entities need to be aware of the two new offences that were introduced by the Criminal Finances Act 2017, which apply from 30 September 2017 onwards. The first applies to the facilitation of UK tax evasion, and the second applies to the facilitation of foreign tax evasion.

Criminal facilitation of tax evasion involves a person deliberately and dishonestly helping another person to evade tax. This doesn't include the accidental, ignorant or negligent facilitation of tax evasion. This is referred to in the Criminal Finances Act 2017 as a 'Tax Evasion Facilitation Offence', (as defined in s. 45(5)).

A business may commit one or more of the offences when a person providing a service for or on behalf of the business criminally facilitates tax evasion and the business did not have procedures in place to prevent it.

It's possible to report on behalf of a company or partnership if it has failed to prevent the facilitation of tax evasion. This is known as self-reporting.

Further guidance on the new offences, and how to protect against them, can be found in HMRC's guidance Tackling tax evasion: Government guidance for the corporate offences of failure to prevent the criminal facilitation of tax evasion.

Business should be aware that:

from 1 April 2018, the Welsh Revenue Authority may investigate the domestic tax offence in Wales where the tax evaded has been devolved; and
there are no provisions for deferred prosecution agreements in Scotland.