Big firms avoid procurement crackdown

Large accounting firms have avoided a crackdown on advising companies and individuals with a history of breaking tax rules bidding for government contracts.

Under new proposals from 1 April companies will have to make a declaration about their tax activities if they bid for contracts worth more than £2m.

However a Treasury spokesperson told AccountingWEB that the new guidance relates directly to companies that are bidding for government contracts, not to their advisers.

"It will apply to any firm bidding for government contracts, but only to their own tax affairs, not to any advice they are giving other people or companies," the spokesperson said.

The rules are outlined in draft guidance published for consultation by the government.

Under the new regime, designed to accommodate EU rules, potential suppliers will be forced to disclose any occasion in the past decade when they have not complied with tax rules.

Combined with the introduction of a general anti-abuse rule coming in in April, agencies will have the power to refuse contracts on the grounds a company has engaged in “aggressive” or “highly artificial” tax avoidance schemes.

They will have to tell the department if any tax return has recently been found to be incorrect as a result of:

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Comments
carnmores's picture

yea right

carnmores | | Permalink

what about all the contractors various government departments are still using thro limited companies , employers nic etc etc

The VAT Doctor's picture

Mapeley

The VAT Doctor | | Permalink

The utter hypocrisy! Never mind the fact that a large number of MP's and Peers were fiddling their expenses, it is of course a fact that the HMRC landlords (Mapeley) are operating a massive tax avoidance scheme

http://tinyurl.com/aa5ooa8

Here's a House Of Commons Report into this.

http://www.publications.parliament.uk/pa/cm200203/cmselect/cmtreasy/184/...

Read the following quote from this report.  Amazing!

25. The Board of the Inland Revenue was not informed by the project team that, under the contract, the Revenue's properties would be transferred to a company registered in Bermuda. The Board appears to have discovered this fact a few days before the contract was due to be signed only because one of its members, knowing that arrangements of this sort were common, asked what the structure of the Mapeley companies was. The Customs and Excise Management Committee and the relevant Minister, the Paymaster General, were not told of the offshore structure of the contract before it was signed. We reject the proposition put forward by the Chairman of the Inland Revenue that at worst the charge against the project team is one of naivety, a view we believe is complacent. We view with great concern the fact that such failures in briefing senior management and the Minister have occurred. We expect the Departments to have identified exactly where and how things went so seriously wrong and to have taken the necessary steps to prevent a recurrence.