Press Release

25 September 2009

Fears that new tax amnesty registration system is open to abuse

 

  • Email registration has no basic measures to prevent malicious activity

 

The email notification system for the new tax amnesty (New Disclosure Opportunity) lacks the basic safeguards needed to prevent potential abuse warns McGrigors, the leading commercial law firm and tax investigation specialists.

 

McGrigors says that the email registration system has no security measures to stop individuals maliciously impersonating another taxpayer and claiming they have underpaid tax.

 

The New Disclosure Opportunity (NDO) allows individuals with unpaid tax in offshore bank accounts the chance to declare and settle the sums they need to pay at a favourable rate.

 

McGrigors explains that whilst postal notifications for the NDO need a name, address, National Insurance (NI) number and date of birth to be supplied, the email registration system only asks for a name and address.

 

McGrigors explains that without requesting a NI number HMRC can not verify whether the online applicant is genuine or just someone trying to get another person in trouble.

 

Phil Berwick, Director of Tax Investigations at McGrigors, says: “Anyone with a personal grudge can now submit another individual’s name and address via the email registration process, flagging them up to HMRC as someone who has unpaid taxes.”

 

“The first that the victim may be aware that their name has been forwarded to HMRC is when they receive their Disclosure Reference Number. Unless they contact HMRC at that stage and notify them of the error, they may find themselves the subject of an investigation. HMRC will be expecting them to make a disclosure of tax irregularities, and will launch an investigation if one is not made."

 

Phil Berwick says that “telephone hotlines” that allow individuals to tip-off HMRC about possible tax evasion are frequently abused by people making groundless reports against neighbours, former friends, business partners and even ex-partners from relationships.

 

Phil Berwick comments: “It is strange that the same levels of security have not been applied to the email notification process. This security lapse could cause big problems for anyone who is subsequently targeted by HMRC.”

 

The deadline for notifying by email is 30 September 2009, after which online notification can be made.  Phil Berwick comments: “We are quite amazed that HMRC have not put basic security measures in place on the NDO’s email notification system and would urge them to do so – it would save both themselves and potentially large numbers of taxpayers a huge amount of unnecessary hassle. It is to be hoped that the online notification process which starts from 1 October will not suffer from the same problem.”

Andy Peat

Business Development Director
Telephone: +44 (0)20 7054 2710
Mobile:  +44 (0)7894 835 386
Email: andy.peat@mcgrigors.com

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