People don't like paying their taxes but tax is compulsory to maintain public services. That is what the government advises the general public. Tax collection is for the greater public interest. In this article, we will be discussing all about tax fraud and how to report it.
What is tax fraud? Tax fraud or tax avoidance is when an individual or business wilfully and intentionally falsifies information on a tax return to their own advantage in order to limit the amount of tax liability. Tax fraud is the cheating of the system and is cheating on a tax return in an attempt to avoid paying the entire tax obligation. Examples of tax avoidance would include claiming false deductions, claiming personal expenses as business expenses and not reporting income. Is benefit fraud the same thing? Benefit fraud and tax fraud could be considered the same thing as it involves keeping money that is not yours. With tax, it is mandatory to pay to maintain your health services, road services, council services and much more. Benefits are a form of financial aid which is given to those who genuinely need it in difficult times. Thus, someone who falsely applies for benefits is cheating the system also. Therefore, they are both illegal and unjustly.
Penalty for tax fraud
How can you report tax fraud? If you are aware of a person conducting tax fraud and you wish to report it, the procedure is made quite simple and straightforward as to encourage more people to report it. There is a customs fraud hotline with the number 0800 595000 taken from the website below, and you can also report it on the internet to the HMRC (HM revenue and Customs) department. The forms are available online at the website Direct.gov.uk under the category tax evasion. Is tax fraud punishable? Tax avoidance is illegal in the United Kingdom. The penalty for your tax evasion will all depend on the seriousness of the level of your avoidance to pay tax. If you evaded tax, you must pay for the tax that you owe plus the interest and penalties. There is a possibility that you could face imprisonment, but it is unlikely, especially for smaller amounts (under £50k). You can make arrangements that the HMRC will accept, such as selling your house or paying in instalments.