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Mark McLaughlin asks about the benefit to taxpayers of coming clean to HMRC before a tax campaign starts.

I hope that you read last week's Editorial by Mike Wells, HMRC's director of Risk and Intelligence, about HMRC's campaigns aimed at 'customers' in specific risk areas of tax loss.

If you missed it, you can read Mike Wells' article here. In addition, you can find out more about the campaigns by visiting HMRC's website.

On the face of it, the concept of campaigns aimed at particular groups of taxpayers (e.g. plumbers) seems a sensible one. The campaigns are certainly a cost-effective strategy for HMRC.

However, an aspect of these campaigns has caused uncertainty and confusion: what about taxpayers who wish to come forward and make a disclosure to get their tax affairs in order, but are not within a HMRC campaign because they do not fall within the specific category of taxpayers being targeted? Should they come forward anyway, or should they wait and see if a future campaign covers them specifically?

HMRC has previously indicated that if a taxpayer comes forward and makes a full, unprompted voluntary disclosure about their tax affairs, they will be better off (at least in terms of lower penalties) than if HMRC approaches them first. However, that is not really telling us anything that we don't already know regarding penalties, because the law provides for lower penalties if a taxpayer disclosure is 'unprompted' as opposed to 'prompted'.

What I (and others) really want to know is this: will taxpayers who come forward to HMRC be offered the same (or similar) terms to those who currently happen to be the subject of a specific campaign?

I suspect that HMRC may be uncomfortable about giving a straight answer to this question. After all, it is arguable that if the answer is "yes" there is not much point in launching campaigns at all. On the other hand, if the answer is "no", HMRC may be anxious that taxpayers will consider that there is a disincentive for taxpayers to come forward immediately, i.e. so that taxpayers will choose to 'stick' (i.e. wait for a suitable campaign in the future) rather than 'twist' (and make a disclosure now), to use a card playing analogy.

TaxationWeb has been pressing HMRC on this point for some time. When (and if) we do get a straight answer to the above question, we will let you know.

What is your view about HMRC's campaigns? Your feedback will be welcome.

Best wishes,

Mark McLaughlin

Managing Editor