Court was bad news for this Hyrax
A Hyrax is a small, shy, furry mammal usually found in Africa but HMRC caught a big one of their own this week.
Hyrax Resourcing was found by a First-Tier tribunal to have promoted a disguised remuneration avoidance scheme under Disclosure of Tax Avoidance Schemes (DOTAS) rules.
The scheme allowed Hyrax to pay users loans to enable them to avoid paying income tax and national insurance on their earnings. The users paid Hyrax a fee of 18% to allow them access to the scheme. The amounts received were loans and not declared as income by the recipients.
Not only did are HMRC set to collect £40 million from Hyrax in unpaid taxes but they must now disclose the full details of the scheme to the tax authorities including the names and details of the 1,180 users of the scheme.
Failure to do so could result in a further penalty of up to £6 million – £5,000 per client and an additional fine of £5,000 per day for non-disclosure.
Mel Stride MP, financial secretary to the Treasury, said: “HMRC is cracking down on unscrupulous promoters who sell these highly contrived tax avoidance loan schemes.
“Promoters should take note of this decision and get in touch with the Revenue about other undisclosed schemes immediately”.
There is no right of appeal against the decision although Hyrax are entitled to pursue a judicial review.
The HMRC are serious creditors and require a serious response. If your company has received a nasty surprise in the form of an HMRC Accelerated Payments Notice (APN) or a Follower Notice then you should take a breath and contact one of our expert team to discuss your options.