This is to announce a new procedure where HMRC suspect that there are serious indirect tax irregularities, knowing involvement in transactions that form part of a Missing Trader Intra-Community (MTIC) fraud and have reason to believe dishonest conduct has occurred, where neither criminal investigation nor the Civil Investigation of Fraud procedure outlined in Code of Practice 9(2005) is appropriate.
Code of Practice 9(2005) covers HMRC investigations of suspected serious fraud against the Exchequer where, for policy or operational reasons, it is considered inappropriate to launch a criminal investigation. Where cases are not suitable for Code of Practice 9 (2005) or criminal investigation, for indirect taxes, there is already a procedure for penalties to be imposed for dishonest conduct in cases involving lower level fraud set out in Notice 160 (Enquiries into Indirect Tax Matters (2007)).
This statement introduces a new notice, Notice 161, which explains how enquiries into serious indirect tax irregularities will be handled in cases involving transactions that form part of an MTIC fraud and where HMRC have reason to believe dishonest conduct has occurred.
The procedure complements HMRC’s policy of providing a level playing field for all businesses by supporting those who wish to comply but dealing severely with those who seek an unfair advantage through non-compliance. It will be used in cases where HMRC suspects knowing involvement in transactions that form part of a (MTIC) fraud.
A copy of the new Notice 161, is being placed in the House of Commons Library.