HMRC: Admit tax fraud or face criminal investigation

Taxpayers suspected of fraud by HMRC will be able to avoid criminal investigations if they admit to their actions, under a new initiative.

Under the new Contractual Disclosure Facility, HMRC will contact a taxpayer to inform them that they are suspected of serious tax fraud, offering them the opportunity to enter a contract giving them 60 days in which to disclose their fraud, in return for which HMRC will agree not to criminally investigate them.

However, they will still be investigated using civil powers, with a view to a civil settlement for tax, interest and a financial penalty.

Meanwhile, taxpayers who do not sign up to the contract could potentially be criminally investigated, with a view to prosecution, and the same will apply to anyone who reneges on the contract.

David Gauke, Exchequer Secretary to the Treasury, said: "This new facility is a valuable tool which will help HMRC in its fight against fraud.

"HMRC will set out clearly what is expected of taxpayers, and what will happen to fraudsters who choose not to disclose their crimes."

The new arrangements will not apply to any taxpayers who want to admit to fraud but who are not already under investigation.