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‘Tax catch up plan’ targets tutors and coaches

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HMRC has launched a campaign to target private tutors and coaches who have failed to declare their income.

‘The Tax Catch up Plan is for people providing private lessons, regardless of whether they have a teaching qualification. It is aimed at those who profit from tuition and coaching, as a main or secondary income, on which the correct tax has not been paid because they have not told HMRC about it,’ HMRC said.

‘The opportunity is available to those providing tuition, instruction or coaching. This includes, for example, tuition of traditional academic subjects, fitness and dance instruction, musical instrument tuition, art, services provided by life coaches and others.’

Tutors and coaches have until 6 January 2012 to notify HMRC that they plan to make a voluntary disclosure, and until 31 March 2012 to ‘tell HMRC about their outstanding tax for the years up to 5 April 2010 and pay what they owe’.

HMRC said those who come forward by the deadline are likely to receive ‘the best possible terms’ for paying the tax owed.

‘If they have to pay a penalty, it is unlikely to be more than 20% of the unpaid tax. Those who wait for HMRC to come to them will find that they have to pay much higher penalties, or even face criminal prosecution. After 31 March, using information pulled together from different sources, HMRC will investigate those who have chosen not to come forward.’

Notification can be made via the HMRC website.

HMRC launched a ‘VAT initiative’ in July, targeting businesses operating above the VAT threshold that have not registered.

Other campaigns, to be launched in 2012, will target ‘e-marketplaces’ and ‘another group of tradespeople’, building on this year’s ‘plumbers’ campaign’.