HMRC has launched a new taskforce to tackle fraudulent claims made under coronavirus support schemes, with criminal investigations already underway.
Taxpayer Protection Taskforce
Throughout the Covid-19 pandemic, the UK government has implemented a range of financial support schemes to help both individuals and businesses that are struggling to stay afloat. This includes the Self-Employment Income Support Scheme (SEISS), the Coronavirus Job Retention Scheme (CJRS), the Eat Out to Help Out Scheme and the Bounce Back Loan Scheme, to name but a few.
However, critics warned that such schemes were open to abuse, and that funds were being misused by so-called ‘Covid-19 fraudsters’. In a bid to recover any erroneous payments, Chancellor Rishi Sunak announced in the Spring Budget that £100 million extra funding would be given to HMRC. This money has been used to set up a 1,250-person strong taskforce, which has been given the remit of tackling fraud in government Covid Schemes.
More than 100,000 inquiries opened
The Taxpayer Protection Taskforce has opened more than 10,000 inquiries, a number that is expected to double in the not-too-distant future. HMRC has said it will be cross-referencing claims made by individuals and businesses with other records, including PAYE records, tax returns and debit card data. It is also urging members of the public to come forward and report potential wrongdoing.
HMRC has said it will send letters to businesses and individuals who may have made incorrect claims under the various government support schemes. Everyone is being urged to check their records to ensure that the claim was eligible, and that the correct amount of money was claimed. HMRC is promoting transparency and co-operation, suggesting that those who admit to genuine mistakes need not be concerned.
In a statement, HMRC said: “We continue to encourage businesses and individuals to come forward and self-correct if they have made a mistake in their claim. We appreciate claimants may have made genuine mistakes and no-one who has tried to do the right thing but made an honest mistake has any need to be concerned, as long as they work with us to put it right.”
Arrests and criminal prosecutions
Those who fail to repay incorrect payments will incur interest and other penalties. Anyone found guilty of intentionally defrauding the system could face more serious repercussions, such as a criminal prosecution. In fact, arrests have already been made, including a man in the Midlands who is suspected of £495,000 furlough fraud.
The taskforce has also recovered £357,000 from a company who claimed furlough payments, despite forcing its staff to work throughout the pandemic. In addition, there have been reports of restaurants claiming furlough payments for ‘off the book’ employees, while at the same time participating in the Eat Out to Help Out Scheme – despite claiming to be closed.
The Taxpayer Protection Taskforce has only just started its investigations. It is thought that thousands more individuals, restaurants and other businesses will come under review. If you or your business is one of them, we urge you to get early legal advice. Failure to respond to HMRC could lead to further penalties for non-compliance.
Speak to our solicitors
If you have received any communications from HMRC in relation to fraud, or are concerned you may receive these communications in the near future, Altion Law offers an initial consultation service to discuss these concerns.
If you would like to have a free confidential discussion with a member of our team, please either make a Free Request For Call Back or call us directly on 01908 414990 and we will be pleased to help you.