Credit Card Sales Campaign

Gary Green
Gary Green
June 13, 2024

Originally set up in 2014, HMRC’s Credit Card Sales Campaign was aimed at individuals and businesses that accept payment via debit or credit card for services and goods and have failed to fully declare to HMRC all of their sales.

HMRC has secured information about debit and credit card payments that have been made to businesses in the UK and can compare the data to various businesses’ declared turnover. If a discrepancy between the figures is detected, HMRC will launch an investigation to determine whether or not the business in question has failed to accurately declare their turnover.

The point of the Credit Card Sales Campaign is to reduce the penalties that would be levied by HMRC when compared with the amount that would be levied if the relevant information was not volunteered before HMRC launched an investigation. HMRC usually views all income that is undeclared as having been concealed deliberately, and that has a negative effect on the penalty that is eventually applied.

How Can I Participate In This Campaign?

To participate in this campaign, you must:

  • Notify HMRC you intend to participate in the scheme.
  • Disclosure to HMRC all of your gains, income, duties, and tax you have not yet disclosed to them.
  • Make HMRC a formal offer of settlement.
  • Pay the amount that you owe.

Why Participate In The Campaign?

There are several benefits that come with participating in this HMRC campaign. Whether you deliberately avoided payment of the correct amount or whether you misunderstood the rules and therefore made a reporting error, it is always best that you approach HMRC independently to admit your inaccuracies or failures instead of waiting for them to be uncovered during an investigation.

This campaign offers more favourable terms for those who are keen to get their tax affairs right. The amount of penalties that will be levied will be lower than they would be if you waited until HMRC launched an investigation into your affairs. In fact, in some cases, you may have no penalty to pay if you opt to participate in this scheme.

How Long Does The Campaign Go Back?

If your Corporation Tax self assessment or income tax self assessment was completed on time but a mistake was made during the declaration of your income, you will need to make payments for a different number of years depending on why you made the error. That may be up to 4, 6, or, in some cases, 20 years. If you fail to participate in the scheme and HMRC discovers later that you are not up to date with your taxation affairs, it is harder to make them believe the act was not deliberate. You could, therefore, face a potential criminal investigation as well as penalties dating back as many as 20 years.

What If I Do Not Disclose My Liabilities?

HMRC actively targets tax evasion via credit and debit card sales. To that end, it uses information held on its own digital intelligence system in order to pinpoint any taxpayers who may have failed to declare their entire amount of income. With this in mind, HMRC carries out inquiries or checks to resolve these issues and once this takes place, the taxpayer can no longer participate in the scheme. If additional tax is found to be due when HMRC investigates the matter, the amount of penalty charged will almost always be higher, up to a maximum of 100% of your unpaid liabilities and up to 200% in cases of offshore income.

Will All Disclosures Be Accepted Via The Campaign?

HMRC is likely to accept many disclosures through this campaign, but there are certain disclosures that will almost certainly not be accepted. These include any disclosures are can be shown to be incomplete or materially incorrect when HMRC checks them. Furthermore, any disclosure from a customer to whom HMRC has already opened a compliance check or inquiry before receiving the customer’s notification of intention to disclose will probably not be accepted. Anyone who wishes to disclose their liabilities under such circumstances must inform the individual carrying out the inquiry. When disclosure is made at the earliest opportunity and in full, this will have an effect on how much will be levied as a penalty by HMRC in the investigation or ongoing inquiry.

Any instance that involves a disclosure in which HMRC is suspicious that the money has been gained through serious organised crime will probably not be accepted. Some examples of that include bogus registration VAT fraud, VAT fraud, and organised tax credit fraud, as well as any cases where wider criminality exists in the form of a current police investigation.

If a person’s failure to report or inaccuracy in reporting was due to a deliberate act that they subsequently attempted to conceal, the disclosure will also not be accepted.

A key factor when it comes to HMRC deciding whether a criminal or civil investigation will be launched into a case of fiscal fraud is if the taxpayer has disclosed the amounts improperly reclaimed or evaded without being prompted and in full. While HMRC considers all cases on their individual merits, an unprompted and complete disclosure generally suggests that the investigation should be a civil one and not a criminal one.

It is important to note that if you had eligibility for a disclosure opportunity offered by HMRC in the past and failed to make a disclosure under that scheme, HMRC will probably be unable to accept your disclosure through this campaign. You will therefore be expected to work out the penalty as well as the number of years the penalty covers to reflect the action being taken deliberately, and failure to do this will lead to your disclosure not being accepted.

Using Tax Investigation Specialists To Help

If you want to disclose inaccuracies and discrepancies to HMRC through the Credit Card Sales Campaign, you should always contact tax investigation specialists to get professional expert advice so that you can be sure you are taking the right course of action.

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