The Criminal Finances Act 2017 means companies can be found liable if they fail to prevent the criminal facilitation of tax evasion. That applies to violations made individuals or organisations providing a service on their behalf.
The legislation came into effect in September 2017. But a survey of senior individuals in 1,000 UK companies and partnerships shows there is a long way to go. Conducted for HMRC by Ipsos, the survey revealed that just a quarter of businesses had heard of the legislation.
The report found that larger companies were more likely to be aware of the Criminal Finances Act at 58%. That’s compared to medium, small and micro business, which came in at 30%, 26%, and 24%, respectively. Unsurprisingly, finance and insurance companies were the most aware at 58%. That’s compared to all other sectors, which stood at 24%.
HMRC has stated companies need to assess the risk of being exposed to the facilitation of tax evasion by those providing services on their behalf. Large businesses were three times more likely than micro businesses to have assessed this risk, at 57% compared to just 19%.
Additionally, just 8% of respondents had organised corporate procedure training to prevent the facilitation of tax evasion in the last 12 months.
The results will undoubtedly raise concerns for HMRC. They want executives to actively promote an in-house culture preaching the lawlessness of tax evasion.
The Law Society provides guidance for businesses on the Criminal Finances Act 2017, which you can read here. Stay tuned to the Mango Pay blog for the latest news and insights affecting your business today.