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After slow start, HMRC launches 13 investigations into Corporate Criminal Offences

Published on 28 October 2020

New data published by HMRC shows that after a slow start, the Revenue has opened 13 investigations into businesses for suspected Corporate Criminal Offences, says RPC, the City-headquartered law firm.

Legislation that came into effect in September 2017, made it a criminal offence in the UK if a business fails to prevent its employees, or any person associated with the business, from facilitating tax evasion.

Businesses that come under investigation by HMRC must prove that they have reasonable prevention procedures in place to prevent the facilitation of tax evasion from taking place.

 In addition to the 13 investigations that are currently underway, HRMC says it is also reviewing a further 18 live opportunities.

Adam Craggs, Partner and Head of Tax Disputes at RPC says: “It would appear that after some delay, HMRC has decided to investigate various businesses suspected of Corporate Criminal Offences with a view to those businesses ultimately being prosecuted.”

“Over the past three years, businesses should have put in place appropriate measures to minimise the risk of prosecution. If they haven’t yet done so, these investigations should serve as a timely reminder to them to do so.”

“In addition to the possibility of incurring a substantial fine, a successful prosecution for failure to prevent the facilitation of tax evasion could give rise to serious reputational damage for an organisation. Corporate Criminal Offences are not something that businesses can afford to ignore.”

"It is known that HMRC are concerned by the level of suspected furlough related fraud and there is every possibility that it will choose to prosecute businesses it suspects of such fraud by relying on the Corporate Criminal Offences."