HMRC is consulting until 10 July 2016 on revised draft legislation and a first draft of guidance for the new corporate criminal offence of failure to prevent facilitation of tax evasion. The legislation has been revised from the version published in December 2015 to contain separate provisions for UK and foreign tax evasion offences. It will apply to all legal persons, e.g. companies, partnerships and LLPs, regardless of whether they operate commercially or for other reasons (such as charity). The offence will arise where there is:
· criminal tax evasion by a taxpayer;
· criminal facilitation of this offence by a person acting on behalf of the corporation; and
· failure by the corporation to take reasonable steps to prevent those who acted on its behalf from criminal facilitation of tax evasion.
The revised legislation has also expanded the ‘reasonable steps’ defence to include circumstances in which it would not have been reasonable to expect the corporation to have any prevention procedures in place.
The person ‘acting on behalf of the corporation’ may be an employee or a contractor.
HMRC is consulting until 10 July 2016 on revised draft legislation and a first draft of guidance for the new corporate criminal offence of failure to prevent facilitation of tax evasion. The legislation has been revised from the version published in December 2015 to contain separate provisions for UK and foreign tax evasion offences. It will apply to all legal persons, e.g. companies, partnerships and LLPs, regardless of whether they operate commercially or for other reasons (such as charity). The offence will arise where there is:
· criminal tax evasion by a taxpayer;
· criminal facilitation of this offence by a person acting on behalf of the corporation; and
· failure by the corporation to take reasonable steps to prevent those who acted on its behalf from criminal facilitation of tax evasion.
The revised legislation has also expanded the ‘reasonable steps’ defence to include circumstances in which it would not have been reasonable to expect the corporation to have any prevention procedures in place.
The person ‘acting on behalf of the corporation’ may be an employee or a contractor.
