Property professionals and construction companies rank among the worst offenders when it comes to those penalised by HMRC for tax evasion, according to research by RIFT Tax Refunds.
The company analysed data on individual penalties for deliberately defaulting on tax issued by HMRC since the start of the 2010 financial year, grouping these by business trade or occupation.
The research found that since April 2010, an estimated £50.2m has been handed out in penalties. The property industry accounts for approximately £3.3m of that total, putting it in fifth place in the table. In second place is the building and construction industry, with a total of approximately £8.7m fines. The supply chain and wholesale trade accounts for the biggest total of fines, with £11.9m. Making up the rest of the top five are logistics and transportation (£4.7m) and hospitality and food (4.5m). The total of fines for property income, meanwhile, comes in at £783,610.
The average penalty for deliberately defaulting on tax is just shy of £31,000. The average fine for the property industry, however, is more than £61,000.
Bradley Post, CEO of RIFT Tax Refunds, commented: “Whether it be for attempts at tax evasion or tax avoidance, those operating outside of the boundaries of legality are likely to feel the wrath of HMRC at one point or another. While the former is a direct and illegal attempt to reduce tax owed and can even carry a prison sentence, the latter is considered as operating within the rules albeit on an ethically questionable basis.
“However, dealing with HMRC can be a complex matter and all too often those trying to exploit legal loopholes by avoiding tax rather than evading it will also find themselves in hot water if they aren’t completely watertight when acting creatively with their tax returns.”
Earlier this week, RIFT warned self-employed property professionals and landlords that the 31 January self-assessment deadline is fast approaching.
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