In the Budget 2014 announcement, Osborne stated: “While the vast majority of wealthy people pay their taxes, there is still a small minority who do not.
“We will now require those who have signed up to disclosed tax avoidance schemes to pay their taxes, like everyone else, up front.”
Mr Osborne has confirmed that he will “modernise and strengthen HMRC’s debt collection powers.”
The tax office will be awarded “modern powers” to obtain tax credit debts directly from the bank accounts of those who continually avoiding paying their bill.
The Chancellor has also announced plans to introduce what is effectively a ‘pay first, trial later’ procedure for those who are believed to have been involved in tax avoidance schemes.
Mr Osborne predicted in his statement that this new measure will generate around £4 billion in additional tax receipts.
What is the difference between Tax Avoidance and Tax Evasion?
Tax avoidance is a legal way of reducing a tax bill by using a number of different accounting practices to achieve this. Popular tax avoidance methods include changing business structures through incorporation, setting up an offshore company in a tax haven, or deducting tax for sundry items such as equipment or materials. The company fully discloses this information to HMRC.
Tax evasion is an illegal way of reducing a tax bill. This is where tax affairs are deliberately misrepresented or concealed in order to decrease someone’s tax liability, which includes disclosing false information to HMRC.
KinsellaTax’s team of tax investigation experts consist of ex-Inland Revenue Inspectors and ex-Custom and Excise Officers, fully trained in all types of HMRC Investigations.
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