Tax Evasion in UK Law

Leading Cases
  • Commissioners for HM Revenue and Customs v Pendragon Plc and Others
    • Supreme Court
    • 10 Junio 2015

    Artificiality, if it is to be deployed as a workable legal concept, has to be tested against some standard of transactional normality, and the search for such a standard is far from straightforward. Taxpayers faced with a choice between alternative ways of achieving some commercial objective are in principle entitled to select the one with the more tax-efficient statutory outcome.

  • Ivey v Genting Casinos (UK) Ltd (trading as Crockfords)
    • Supreme Court
    • 25 Octubre 2017

    There is no reason why the law should excuse those who make a mistake about what contemporary standards of honesty are, whether in the context of insurance claims, high finance, market manipulation or tax evasion. The law does not, in principle, excuse those whose standards are criminal by the benchmarks set by society, nor ought it to do so.

    When dishonesty is in question the fact-finding tribunal must first ascertain (subjectively) the actual state of the individual's knowledge or belief as to the facts. When once his actual state of mind as to knowledge or belief as to facts is established, the question whether his conduct was honest or dishonest is to be determined by the fact-finder by applying the (objective) standards of ordinary decent people.

  • Serious Organised Crime Agency v Gale and another
    • Queen's Bench Division
    • 12 Mayo 2009

    To consider the evidence adduced in the Portuguese proceedings is not to re-litigate because what is in issue in these proceedings is not the commission of the specific offences alleged against DG in Portugal but whether on the evidence before this court of the material considered by the Portuguese Court, together with the evidence available to the Spanish Courts and other material not considered by the courts in either jurisdiction, the claimant has proved on the balance of probabilities that DG's wealth was obtained through unlawful conduct of a particular kind or of one of a number of kinds, each of which would have been unlawful conduct: see Section 242 (2) (b) of POCA – that is to say drug trafficking, money laundering and tax evasion.

    I have made specific findings of fact in the course of this judgment – see paragraphs 54, 55, 57, 65, 66, 72, 73, 76, 78, 84, 89, 90, 93, 97, 99, 100, 103, 104, 109, 111, 115, 116, 122, 123, 124, 125, 126, 132, 134 and 136 —and so at the risk of some repetition, I am in no doubt that DG and TG engaged in unlawful conduct – in DG's case, money laundering and drug trafficking, in TG's case, money laundering. There is also evidence of tax evasion in four jurisdictions.

  • Mobilix Ltd ((in Administration)) v HM Revenue and Customs; Blue Sphere Global Ltd v Same; Calltel Telecom Ltd and Another v Same
    • Court of Appeal (Civil Division)
    • 12 Mayo 2010

    The test in Kittel is simple and should not be over-refined. It embraces not only those who know of the connection but those who “should have known”. If a trader should have known that the only reasonable explanation for the transaction in which he was involved was that it was connected with fraud and if it turns out that the transaction was connected with fraudulent evasion of VAT then he should have known of that fact.

    A trader who decides to participate in a transaction connected to fraudulent evasion, despite knowledge of that connection, is making an informed choice; he knows where he stands and knows before he enters into the transaction that if found out, he will not be entitled to deduct input tax. The extension of that principle to a taxable person who has the means of knowledge but chooses not to deploy it, similarly, does not infringe that principle.

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Legislation
  • The Facilitation of Tax Evasion Offences (Guidance About Prevention) Regulations 2017
    • UK Non-devolved
    • 1 de Enero de 2017
  • Finance Act 1944
    • UK Non-devolved
    • 1 de Enero de 1944
    ... ... S-17 ... Fraudulent evasion of purchase tax. 17 Fraudulent evasion of purchase tax ... (1) If any person is knowingly concerned in, or in the ... taking of steps with a ... ...
  • Serious Crime Act 2007
    • UK Non-devolved
    • 1 de Enero de 2007
    ... ... 50(2) or (3) (improper importation of goods) ;(b) section 68(2) (exportation of prohibited or restricted goods) ;(c) section 170 (fraudulent evasion of duty etc.) .(3) An offence under either of the following provisions of the Criminal Justice (International Co-operation) Act 1990 (c. 5) —(a) ... ...
  • Value Added Tax Act 1983
    • UK Non-devolved
    • 1 de Enero de 1983
    ... ... 39: Offences and penalties ... (1) If any person is knowingly concerned in, or in the taking of steps with a view to, the fraudulent evasion of tax by him or any other person, he shall be liable—(a) on summary conviction, to a penalty of the statutory maximum or of three times the amount ... ...
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Books & Journal Articles
  • Tax evasion and financial instability
    • No. 27-2, April 2020
    • Journal of Financial Crime
    • 531-539
    Purpose: The purpose of this paper is to explore the association between tax evasion and financial instability. The discussion also examines the effects of tax evasion for financial instability. D...
  • Tax Evasion and the Internet
    • No. 2-2, April 1998
    • Journal of Money Laundering Control
    • 105-114
    The purpose of this article is to address the issue of tax evasion and the internet. While the internet has been the subject of growing media attention, the concept of tax evasion and the internet ...
  • Tax evasion and avoidance typologies
    • No. 11-2, May 2008
    • Journal of Money Laundering Control
    • 123-134
    Purpose: The purpose of this paper is to explore tax evasion and avoidance typologies with a view to understanding how they work and the implications for those who handle the wealth of others. Des...
  • Does Tax Evasion Affect Occupational Choice?*
    • No. 65-3, July 2003
    • Oxford Bulletin of Economics and Statistics
    This paper presents a novel micro‐econometric procedure that identifies the extent to which occupational choices are distorted by opportunities for tax evasion. Previous studies claim to have found...
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Law Firm Commentaries
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