HMRC expects to raise about £7bn though issuing accelerated payment notices to individuals involved in tax avoidance schemes.
Notices relating to known tax avoidance schemes will be issued to 43,000 taxpayers as HMRC clamps down on the use of such schemes.
The Revenue are expecting to raise around £5.1BN from the 33,000 individual tax payers. The remaining 10,000 taxpayers are businesses and are expected by the Revenue to contribution the balance of £1.9BN.
Under the recently introduced ‘Accelerated Payment’ rules, HMRC will be able to make taxpayers pay disputed tax in advance rather than waiting for the outcome of a tax tribunal ruling. If the taxpayer goes on to win their case the money is then returned.
This could result in sizeable tax bills for many people as the HMRC cracks down on tax avoidance schemes.
Bev Budsworth from The Business Debt Advisor who represents many individuals who struggle with Revenue debt, warns that these new powers could trigger a ‘wave of insolvencies’ as many struggle to find the cash to pay these bills.
Bev also expressed concern about the use of the accelerated payment power where there is a genuine dispute. Individuals may well have not retained adequate sums to settle a debt which they had been advised was not due and payable. This could mean that individuals have to look to raise sums under urgent conditions, meaning they have to resort to high interest products. This is likely to panic taxpayers and force them to settle cases which have merits in being pursued to appeal.
It is expected that the accelerated payment notices could be sent out this month with payments due as early as October.
Businesses who are finding themselves in financial difficulty and who are struggling to pay tax debts should speak to The Business Debt Advisor.
We have a great track record of negotiating informal as well as formal settlements with HMRC.