Whistleblowers reporting serious tax avoidance or evasion may be eligible for financial rewards, following changes to how HMRC uses information provided to it.
Under HMRC’s reward scheme, individuals who report tax evasion or avoidance may be eligible for a financial reward where tax is successfully recovered.
This kind of high-value avoidance or evasion usually involves large companies, wealthy individuals, or offshore or avoidance schemes, and reporting this to HMRC could lead to a financial reward.
What can you expect to receive?
If the information you provide to HMRC leads to tax being successfully recovered, you may be eligible for a financial reward. However, the rewards are not guaranteed, they are still paid at the discretion of HMRC.
Some people won’t qualify for an award, including if:
- You are or were a civil servant (or contracted to work in the government) and got the information while you were employed.
- You are the taxpayer involved in the tax evasion or avoidance, or you planned and started the actions that led to the tax evasion or avoidance.
- The information you provide may already be known to HMRC or could have been identified through routine processes.
- The reward might directly or indirectly lead to funding illegal activity.
- You are required by law to disclose, or not disclose, the information.
- You are acting on behalf of someone else.
- You got the information from someone who would not have been eligible for a reward themselves.
- You are providing the information anonymously (anonymous submissions may be accepted, but you would not be eligible for a reward).
Source: Gov.uk
HMRC encourages anyone who knows about tax avoidance or evasion to send a report, even if they are not eligible for a reward.
How do you send a report?
You can send a report to HMRC, via this link report to HMRC, if you think a person or a business is avoiding or evading tax payments. You can make the report anonymously if you wish, but you would not be eligible for a reward. To be eligible, you must provide contact details.
HMRC will handle the information you provide in confidence, and you will be asked to include.
- What type of activity you are reporting (1,200 character limit).
- How you know about it.
- What your relationship is to the individual or business.
- How long it has been going on for.
- The total value, or estimation, of the activity.
- A description of any supporting information you have or know of (500 character limit).
Source: Gov.uk
You can’t add attachments to the report, but you can let HMRC know you have additional information if necessary. Once the report is sent, you’ll get confirmation of receipt from HMRC, and you are asked not to send another report on the same activity.
Also, before you send the report, HMRC asks that you don’t try to find out more information yourself, don’t let anyone know you’re making a report, and don’t encourage anyone to commit a crime to find out more information.
If HMRC wants more information or you’re eligible for a reward, it will contact you. Bear in mind it could be years before you receive an award payment, as it can take a very long time to investigate tax evasion or avoidance.
We can help you meet your obligations
If you need further information about how this scheme works or want to ensure your business is meeting its tax obligations, please get in touch and we would be happy to give you the guidance you need.
Disclaimer
This article is for general information only and reflects our understanding of current HMRC and GOV.UK guidance at the date of publication. The availability and amount of any reward for reporting tax avoidance or evasion is determined solely by HMRC and is not guaranteed. Rules and processes may change. You should seek professional advice before taking any action.