It’s a given that we all have a digital footprint nowadays. You should also be aware that information about you on the internet can also be used by HMRC. You don’t know whether or not the tax man is watching you online.
The Tax Man is Watching You…
HMRC is increasingly effective at joining up different sources of information to build a picture of who isn’t paying as much tax as they should be.
It has said that it will ‘observe, monitor, record and retain internet data’. Along with social media, that includes blogs, news reports and similar. Companies House and land registry records are also used.
This ‘overt’ surveillance depends on the huge amount of data which each of us freely publish online for the world to see. With public settings on social media and no privacy settings applied, this is all open source information.
For example they’ve recently sent out ‘nudge’ letters where people have sold a second home but not declared a profit on their tax return. The ‘nudge’ gives an opportunity to explain why they haven’t paid any tax, and an opportunity to pay.
Submit your information sooner rather than later
HMRC is publishing their intentions to serve as a prompt. That anyone who does have undeclared income or gains should submit their information sooner rather than later. Their message is that the tax man is watching and will catch up with them eventually.
Does your Facebook profile indicate that you’re living a champagne lifestyle but you only declare a meagre amount of income? In those circumstances you could be asked to explain yourself.
An opportunity for complete disclosure
HMRC states that it uses ‘cost effective civil fraud investigation procedures’. This gives taxpayers the opportunity to make a complete disclosure of any irregularities in their tax affairs.
Criminal prosecution is much less likely for people who come clean and offer to settle outstanding liabilities with HMRC. It can’t be ruled out in cases of tax evasion, but honesty should generally mean lower penalties in the long run.
Criminal investigation is usually saved for cases where the conduct is very serious, or where HMRC needs to send out a strong message.
Does your social media profile add up to your tax return? Why don’t you get in touch with us here at Jones Harris for a no-obligation chat?
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