HMRC will target up to 50,000 businesses that have failed to submit VAT returns with warnings that their tax affairs will be closely scrutinised.
The Revenue warned that if returns remain outstanding after 28 February their tax affairs will attract “greater attention”.
The VAT Outstanding Returns campaign will rely on businesses coming forward voluntarily before that date and in return will receive better terms, “as any penalty they pay may be lower than if HMRC comes to them first,” according to a press statement.
People can take part in the campaign by:
- Completing and paying any outstanding VAT returns immediately
- Telling HMRC if they have stopped trading or have changed their business details
The terms on offer are expected to be similar to other campaigns – those opting to make voluntary disclosures will be entitled to pay reduced penalties (10% of tax owed for carelessness and 20% for deliberate understatements or non-disclosures) compared to penalties of up to 100% of the tax due if HMRC identifies them without prompting.