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Individuals With Outstanding Tax Returns To Be Named And Shamed

I am a believer in HMRC treating everyone fairly and that anyone conducting their tax affairs dishonestly and below board should be treated in a manner that is fitting for anyone trying to dodge their taxes. It’s only fair to everyone else who has struggled to keep above the line and make sure they do the right thing. That said, I do think that the new HMRC policy for naming and shaming anyone with outstanding debts could be a little harsh - especially where events that led someone to be on the list were unavoidable.

HM Revenues & Customs are launching a new policy in April that will give them the right to publically name and shame anyone with outstanding tax returns (or tax debts) in excess of £25,000. Bear in mind that the naming and shaming is not being introduced to replace the high penalty charges but it’s an added option for them to [rather forcefully] encourage people to pay their taxes on time.

The idea of a name and shame list isn’t brand new. In the Republic of Ireland, the Revenue Commissioners have been publishing quarterly lists of defaulters since 2001. The list is considered to be a strong measure to discourage anyone from making false tax declarations. The HMRC list is set to contain both the name and address details of anyone with outstanding debts.

There will be an option to request to stay off the list. Although HMRC are unlikely to grant this except in exceptional circumstances. This is my main area of concern as it will rely on them making a judgment call on whether or not to keep someone off the list. Where I see it being a potential issue, is where a small company (e.g. sole operator) have cash flow problems due to issues with their debtors. This will definitely be an area that will test the extent of the new policy when it comes to granting people leave from the list.

Although the policy is being launched from April of this year, it’s not likely that they will be releasing any details until April 2011. They have noted that they won’t be publishing “backdated data”. Time enough for anyone with outstanding tax issues to get them sorted before they are publically named and shamed.

If you are, or feel that you may, fall into this group of people with outstanding tax returns, you may want to consider talking to one of our advisors sooner rather than later to see if we can assist you in staying off the list.

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