HM Revenue & Customs (HMRC) has opened nearly 13,000 probes into firms over possible abuse of the UK Government’s COVID-19 business support schemes.
In news that will interest many organisations seeking out Xero and QuickBooks services in Plymouth and Wellington, CITY A.M. reported that the HMRC investigations data was uncovered by a law firm via a freedom of information request.
The department’s investigations concern suspected fraud and other non-compliance with the rules that firms have been required to abide by in order to participate in programmes such as the Government’s furlough scheme, self-employment income support package, and the “Eat Out to Help Out” initiative.
The taxman looking into possible abuse of Government support
It was discovered that as of the end of March, HMRC had instigated 12,828 probes. The biggest proportion of those – 7,384 – related to the furlough scheme. 5,020 investigations were also launched into potential abuse of the self-employed income support scheme, while 424 probes focused on “Eat Out to Help Out”.
The tax authority commenced the investigations with a view to protecting or recovering funds that may have been lost to fraud, tax avoidance and evasion, and other rule breaches.
A spokesperson for the tax body stated: “It is vital we support businesses to recover by ensuring a level playing field so the majority are not undercut by the few who tried to cheat the system.
“We are taking tough action to tackle fraudulent behaviour. We have now opened more than 12,000 enquiries into claimants we suspect may have kept more than they were entitled to. We have also begun a handful of criminal investigations.”
“The Government needs to tackle the fraudsters robustly”
The news of the HMRC crackdown comes in the wake of Chancellor of the Exchequer Rishi Sunak confirming in the March Budget that the Treasury would invest £100 million into a specialist taskforce to address fraud across the Government’s COVID-19 support packages.
It also coincides with strong words for the Government from the Public Accounts Committee (PAC), which suggested a failure to implement proper fraud checks on the support schemes will leave the taxpayer with a bill running into tens of billions of pounds.
MPs urged the Treasury to outline new transparency guidance for Government support in the coming six months, as concerns were raised that fraudsters could be plundering the public purse.
PAC chair Dame Meg Hillier commented: “Fraud is never acceptable, and when so many were suffering as a result of COVID the Government needs to tackle the fraudsters robustly.”
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