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Has Your Competitor Reported You on the HMRC Hotline?

Newsletter issue - January 07.

HMRC has reported that calls to the Tax Evasion Hotline have rocketed to 75,000 over a three-month period. Apparently, as well as ex-spouses there are now many business rivals reporting others who are trying to gain an unfair advantage.

HMRC clearly believes the hotline is a success and is getting used more all the time as more people become aware of it. It believes that is is the right thing for businesses to be shopping competitors who are not playing by the rules. There is a danger of course that it will also be used by competitors to maliciously report others and give rise to unnecessary enquiries.

It is therefore becoming even more important to be properly represented should you fall under enquiry and to take all other precautions in the first place to minimise the risk of enquiry. If there are no other risk factors, it is likely that an anonymous phone call to the hotline may go no further but if you have other risk factors such as unusual variations on your tax return that have not been explained, the combination may result in an enquiry. Avoidance of tax enquiries is often about knowing what the risks are and properly managing those risks to ensure HMRC do not wrongly suspect you of something.

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