IT contractors should be aware that HMRC will track down anybody it believes could be guilty of tax evasion as a Scottish consultant found to his cost recently.
53-year-old Stephen Maxwell, who currently resides in Dumfries and Galloway, hid nearly £2 million from the Revenue; money he earned whilst he was working as an IT consultant for banks based in London.
Between 1999 and 2008, he consistently attempted to hide his income from HMRC. The banks paid his consultancy fees into companies registered in the Isle of Man and Gibraltar, but Maxwell was a hidden beneficiary of these companies.
According to HMRC Scotland’s assistant director of operations, David Odd, Maxwell operated a deliberate and systematic fraud through his IT consultancy business. HMRC takes a very serious view of people who defraud the Revenue.
Genuine taxpayers are the victims of income tax fraud and the Revenue will vigorously chase anyone it believes is acting dishonestly and bring that person to justice.
Kirkcudbright Sheriff Court remanded Maxwell in custody until the 26th April after HMRC investigators in Leeds looked into his business and income tax records.
Contractors operating through an umbrella company do not need to worry so much about their tax affairs as the umbrella does it for them. But IT contractors working though a limited company or operating as a sole trader need to be aware that HMRC has a zero tolerance policy for tax evasion and they would be well advised to make sure their tax affairs are in order before an inspector comes knocking at the door.
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Image: Robin Hood by Jo Jakeman
