VAT dodgers warned of summer tax clampdown

A CLAMPDOWN on tax dodgers has begun – with traders who have failed to register to pay VAT being given a chance to come forward.

Small businesses such as builders may not have realised their turnover was above the threshold of £73,000, while others could have been avoiding paying the tax, HM Revenue and Customs said.

More than 40,000 letters will be sent out over the next few weeks offering those who have not registered the chance to come forward before September 30 and avoid a maximum penalty.

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HMRC said where traders have to pay penalties on undeclared tax other than VAT, they will be lower than the customary penalty of up to 100 per cent usually charged.

HMRC warned it would investigate all those who fail to come forward before September 30, and substantial penalties or even criminal prosecution could follow.

HMRC director of risk and intelligence Mike Wells, said: “Our campaigns are designed to ensure tax is paid so that the money is available to spend on public services used by everyone. The aim is to make it easy for individuals and businesses to contact us, make a full disclosure of their income and face a reduced penalty on any tax owed.”