As business advisers as well as accountants, at M&S we regularly reiterate to our clients that honesty is the best policy when it comes not just to accounting and taxation, but also to business generally. Despite what some business owners might hear about others “getting away with” it,” HMRC and the authorities do eventually catch up.
There has been much written about fraud during the pandemic, not least the amount lost – totalling, literally, £Billions. Many people thought they could indeed “get away with it.” Increasingly, they now know better…
One case involved a father and son, who were given suspended jail sentences for various bounce-back loan frauds. The son overstated his income to secure an additional £100,000 in bounce-back loans through companies which should not have been entitled to this cash. One of the companies was stated in the application as having turnover of £250,000 in 2019, despite being dormant and therefore unaffected by Covid. He would go on to use the procured funds in a separate business where he is the sole director. That company is currently under-going winding up procedures ordered by the court.
His father pleaded guilty to fraud regarding making a second bounce-back loan application which had already received the maximum loan it was entitled to.
This mirrors what we read about at M&S Accountancy and Taxation, on an almost weekly basis, namely bounce-back loan fraud cases with outcomes including suspended sentences, banning on acting as a company director and in some cases jail. We also note that with the new government in Westminster making loud noises about cracking down on all areas where they believe tax is not being collected/avoided, HMRC is now taking much stronger enforcement action against taxpayers with substantial tax arrears and is more active in investigation of avoidance schemes.
We know the vast majority of business people are honest, but, that said, we also know that it’s not hard to make a mistake. The best way to ensure you don’t is to check. If you’re in doubt, get in touch!
Callum McKinnon, M&S Accountancy and Taxation
