Are you a plumber? If you are, read on. If you’re not just bear with me for now.
Any plumbers in our midst should know that in March this year, HMRC launched a new amnesty called the Plumbers Tax Safe Plan (PTSP).
It’s a chance for Plumbers and Heating Engineers to come forward if they think they have underpaid tax in the past.
The size of any penalties applied and the length of time HMRC will look back into your records will then be dependant on the behaviour that has led to the under-declaration of tax.
This is in line with HMRCs modern viewpoint that you will be treated much more lenoently if you tried to do the right thing and accidentally made a mistake than if you were negligent or fraudulent.
So if you have under-declared your liability due to a mistake, but where reasonable care was taken, there will be no penalty and they’ll go back 4 years. But if you have concealed an error, a penalty of 100% of the tax due may be payable and they can look back 20 years.
If you are a plumber then you have until 31 May 2011to notify HMRC of your intention to disclose under the scheme by this date. The disclosure must be submitted and the liability paid by the end of August 2011. HMRC have said though that they will be amenable to payment plans for those who can’t pay the full liability up front.
Why bother? Well, HMRC has apparently acquired information about plumbers trading in the UK from Gas Safe and Corgi and will be keen to investigate (and potentially prosecute) traders who have errors and don’t come forward under the PTSP. So things will be much worse if you potentially owe tax and try to hide it.
And now non plumbers – still reading? HMRC’s guidance indicates that similar terms to those offered by the PTSP will be available to anyone who comes forward to disclose an undeclared tax liability. So have a think.
If you do think you might have something to tell HMRC or if you’re not confident you got it right in the past then please do get in touch.