Over coming months HM Revenue and Customs inspectors will pick out various specialist trades where they think tax evasion is rife.
Under its so called Plumbers Tax Safe Plan relevant trades are being warned to contact the revenue before inspectors come knocking.
Tax inspectors have given plumbers until the end of May to disclose what they owe and until August to stump up the cash.
After that inspectors are vowing to pull together all available information to track down tradespeople that have not paid full tax, threatening big penalties and criminal prosecutions.
Mike Wells, HMRC’s Director of Risk and Intelligence, said: “Our aim is to make it as easy as possible for plumbers to come forward, make a full disclosure and benefit from a reduced penalty.
“We will be using various intelligence sources to target plumbers who have not declared their full income. I strongly urge any in this group who think they may owe tax on their income to get in touch with HMRC and get their tax affairs in order simply and on the best available terms.
“This is the first step in enabling those with undisclosed income or gains to avoid a full tax investigation with much higher penalties.
He warned: “The message is clear: contact us before we contact you.”
Those that make a full disclosure could still face a penalty rate of 10%, rising to 20% in extreme cases. After the cut-off date tradespeople face fines of 100% of what is owed and criminal prosecution.
Mike Down, Tax Investigations Partner at Baker Tilly said: “This new initiative has been expected for some time and builds on previous ‘amnesties’ relating to offshore bank accounts, Liechtenstein and doctors and dentists.
“Whilst the new scheme inevitably falls short of a general amnesty, interestingly HMRC actively invites anyone with tax irregularities to come forward and disclose using the PTSP forms in the expectation of very similar beneficial terms.
“Anybody with extra income or gains to disclose, whether in the plumbing industry or not, should seriously consider coming forward now. Those who do not and who are subsequently found out will be liable to penalties of between 35% and 100% of the tax evaded.”
Plumbers can call the HMRC special hotline on 0845 600 4507 or go to the website: www.hmrc.gov.uk/plumberstaxsafeplan