Doctors, dentists and other medical contractors are advised to seek the advice of a specialist accountancy service as HM Revenue & Customs (HMRC) look to crack down on tax compliance in the medical profession. HMRC is set to issue letters to around 2,500 medical professionals, in the latest stage of its Tax Health Plan (THP) to stamp out evasion.
Recipients will be urged to get up to date and inform HMRC of earnings that have not been levied. A 21-day deadline will be imposed, after which time individuals may be heavily penalised or even face the same level of criminal prosecution that has so far resulted in nine arrests since the tax safe plan for plumbers ended in the summer.
It has been widely reported over the last year on the number of incorrect tax codes issued by HMRC.
Some 4 million tax payers are believed to have overpaid tax as a result of incorrect code notices being issued. That may be good news for those who are due tax refunds, however, it doesn't end there. A reported 1.4 Million tax payers have underpaid tax of £1,500 on average.
For those who have underpaid amounts of tax of less than £2,000 HMRC will make adjustments to their tax codes next tax year to collect the money. Should someone owe more than £2,000 the facility to have the amount collected via your tax code is not available, HMRC have advised that those affected will be given time to pay.
HMRC managed to secure 157 criminal convictions up to 30 September 2009 some 62 fewer than for the period to September 2008.
Why is this? It seems HMRC are worried about taking cases to criminal prosecution because of the risk of losing in front of a Jury.
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