Capital Gains Tax – A cautionary tale
After being found guilty on 14th July 2017 of fraud by false representation and cheating the public revenue, Richard Fuller was sentenced at Winchester Crown Court on 11th August to two years and three months in prison. The Recorder of Salisbury, His Honour Judge A J Barnett, sentenced Fuller, telling him that deliberately failing to pay Capital Gains Tax over a number of years was “a serious matter”.
“Fuller thought he was above the law and decided not to declare or pay the tax due from the sale of some of his property portfolio,” said Richard Wilkinson, the Assistant Director of HMRC’s Fraud Investigation Service. “It is simply not acceptable to steal from UK taxpayers. HMRC will continue to pursue those who attempt to hide their gains on assets, their income and investigate those who attack the tax system.”
Tax evasion of this kind is investigated by HMRC taskforces, which combine various compliance and enforcement teams for concentrated periods of activity, focused upon particular sectors and locations where evidence is found of an elevated risk of tax evasion and fraud. These teams visit traders to investigate tax practices, including scrutinising records. Over 140 taskforces have been established since May 2011, with more than £540 million brought in so far.
Capital Gains Tax is the tax you pay on the profit you make when selling an asset that’s gone up in value since you purchased it. It’s due on a range of chargeable assets, including many personal possessions worth £6,000 or more (but not your car), and property that isn’t your main home. Your main home can also be eligible if you use it for business, let it out, or it’s over a certain size. As Richard Fuller’s case shows, HMRC will prosecute those who evade paying Capital Gains Tax, and penalties are due on late payments, missed payments and inaccurate returns. If you have any questions around this topic, please feel free to get in touch with us directly.