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A confiscation order of over £1 million has been made against one of the Revenue's more reluctant customers. The taxpayer was convicted of tax fraud in May 2001 and jailed for two years. Failure to pay the confiscation order will result in a further six years in prison.
A confiscation order of over £1 million has been made against one of the Revenue's more reluctant customers. The taxpayer was convicted of tax fraud in May 2001 and jailed for two years. Failure to pay the confiscation order will result in a further six years in prison.
The actual amount of unpaid tax and interest amounted to approximately £450,000, but the confiscation order is said in the Revenue's press release to reflect the 'total amount that [the taxpayer] had benefited from by diverting company money into a hidden bank account rather than simply the amount of tax and interest evaded'. Coming hot on the heels of the recent decision in the Court of Appeal in Attorney General's Reference (No 25 of 2001) (see Taxation, 23 August 2001 at page 519), where the judges decreed that 'the ordinary and natural meaning [of a pecuniary advantage] did not include the balance of profits which were the product of lawful trading', it would be interesting to know how the confiscation order was calculated.
Finally, although not wishing to appear flippant since tax fraud is clearly inexcusable, it is interesting to note that in the press release announcing this confiscation order, the Revenue has shed its cuddly 'we want everybody to consider themselves a customer' image: it is 'taxpayers' rather than customers who are invited 'to come forward and make full disclosure' of any understated profits or income. This demonstrates that the leopard can never change its spots, but more importantly, why does the Revenue seem to think it necessary to do so?
(Source: Inland Revenue Prosecutions press release dated 31 August 2001.)
