Help: Issue with TAX authority(?)

[iamv1]

I was a resident (not citizen) of the United Kingdom for a total of 10 years.

13 months ago I moved out the UK to travel and become a digital nomad,
I kept getting paid into my UK Ltd for these 13 months however I was not a resident of the UK any longer
and now I am settled in South Africa for at least the next 3-4 years (due to family issues).

The problem here is, I have mistakenly declared a lower income tax corporate return to HMRC.

Basically my revenue was 230,000 pounds in one year and I only declared 90,000 pounds as revenue, this
due to a mistake that my accountant made and also me changing too many bank accounts for the company
due to technical issues with my online platform, I basically forgot my revenue was much higher than expected.
I really regret this issues but there is no going back now...


I only used EMIs to get payments for business and never an actual bank account.

What could happen if HMRC finds out that I under estimated the income on the corporate tax return by 150,000+ pounds?

- A huge fine? if so how would i be notified?
- jail time? (even if I don't live in the UK any longer?)

I am now paying personal and corporate tax here in South africa where I incorporated a new company and closed the UK LTD.


I also don't intend to move back to the UK ever anymore, but I don't want any legal problem.
I know if I tell HMRC I'll get a fine anyway now that the return has already been submitted, so I was thinking
about waiting and see what happens?

 

[AdamT1]

Hi, business revenue generated through UK Ltd. by default is subject to UK Corp. tax regardless of your residency. You can always amend the corporate tax return and pay the tax due plus some intertest.

If you want to save the taxes, then there could be some significant penalties if hmrc finds out. This could happen throuh random some cross check initiated by tax authorities of any of your clients/suppliers. But this risk assesment question would required indepth analysis of company's busines transactions & jurisdictions involved.

 

[Martin Everson]

What could happen if HMRC finds out that I under estimated the income on the corporate tax return by 150,000+ pounds?

Over 25k is considered a serious tax offence to HMRC as opposed to a simple criminal offence if HMRC says you did not take reasonable care in preparing your tax return.

- A huge fine? if so how would i be notified?
- jail time? (even if I don't live in the UK any longer?)

You will be prosecuted if caught. You can see the penalties below:

Penalties: an overview for agents and advisers

Find out about the different types of HMRC penalties and how you can help your clients avoid them.

www.gov.uk

At the very least HMRC will add your name and address to the list of deliberate criminal defaulters below even if you live abroad:

Current list of deliberate tax defaulters

www.gov.uk

Contact your accountant asap and get them to correct your filing. Accidents happen but must be corrected immediately.

 

[CyprusLawyer101]

HMRC, ca investigate 20 years back If they suspect deliberate tax evasion, investigations into careless tax returns can go back 6 years and normal nvestigations can go back up to 4 years.

The potential taxes that could arise from the numbers you are mentioning are relatively small> going into a unilateral investigation for something like does not appear to make sense for the hmrc from a cost : benefit analysis point of view.

Hope this helps.

Good luck!
Lawyer 101

 

[iamv1]

Over 25k is considered a serious tax offence to HMRC as opposed to a simple criminal offence if HMRC says you did not take reasonable care in preparing your tax return.



You will be prosecuted if caught. You can see the penalties below:

Penalties: an overview for agents and advisers

Find out about the different types of HMRC penalties and how you can help your clients avoid them.

www.gov.uk

At the very least HMRC will add your name and address to the list of deliberate criminal defaulters below even if you live abroad:

Current list of deliberate tax defaulters

www.gov.uk

Contact your accountant asap and get them to correct your filing. Accidents happen but must be corrected immediately.

Ok, I will contact my accountant now to fix this whole issue.