impact of the new money laundering rules - November 2003
New money laundering regulations finally take effect around the end of the year, following several delays. By law we will be required to inform the National Criminal Intelligence Service (NCIS) wherever we know or suspect someone - including clients - of laundering the proceeds of crime. The penalties for not reporting money laundering (or tipping off an individual that he or she has been reported) can be up to five years in prison. A report must be made wherever there are reasonable grounds for suspicion that such a crime has occurred, including tax and VAT evasion.
Reports of tax evasion are likely to be dealt with by the Inland Revenue or Customs and Excise, who can then be expected to open an enquiry. The Inland Revenue has stated that such investigations will be carried out in the same way as any other enquiry and the investigating officer will not know the source of the original information.
The most effective way of avoiding becoming the subject of a report is to keep complete and accurate accounting records and give us everything we need to prepare your tax returns. Keep us fully informed about anything that might possibly be seen as suspicious. If you think you could have a problem, discuss it with us. Being open and upfront about your financial affairs is the best policy.
To see more articles, see these pages: