Umbrella company contractors might want to take heed of the news that HMRC has got some new anti-fraud technology that it hopes will save it up to £20 million a year.
The Revenue is expanding its usage of the Fraud Screen technology from Fujitsu. Fraud Screen looks at the information in tax credit applications and checks it for discrepancies and potential risks. Based on the reviewed data, the system generates a risk score and passes this on to an intervention team.
HMRC has already run a pilot scheme with the Fujitsu technology and said it achieved savings of £10 million over the six month trial. The financial services industry is already using the tailored technology to combat fraud and reduce mistakes.
Andy Fuller, Fujitsu UK’s assistant director, said the system will go live in a few weeks and it will be looking at the applications flagged as a risk.
It’s not only individuals who need to be more up front and honest in their dealings with the Revenue. Advisors warn that HMRC has changed its tone when it comes to checking small business records.
According to the Taxman, the business records checks are mainly to check compliance, but this is not the way they were originally marketed said Guy Smith from Abbey Tax Protection.
He claims the checks were ‘sold’ to advisors as an educational exercise, but the latest consultation appears to have changed that. The general consensus among small businesses was that they would be given time to make improvements before penalties were incurred. HMRC, on the other hand, has now said that such a policy might lead people to think they did not need to improve their record keeping until they have been caught at least once.
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