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Now, correct me if I am wrong
but I always thought that tax evasion is a criminal offence. My thinking is that it follows that anyone involved would be committing that offence. So what's new Robert?
I may be wrong
I thought the new legislation stopped companies from blaming their employees, as many companies have claimed they were 'totally unaware' of the tax evasion being promoted within their companies.
It will cost companies more, but that always happens. Some people 'bend the rules', and everyone else has to pay the price through increased legislation which is introduced to try to put a stop to it.
Not quite
The new legislation makes the top level management of the company responsible for "being aware" by ensuring that sufficient checks and safeguards are in place to prevent the facilitation of the offence in the first place.
Under existing legislation, companies with decentralised mananagement in particular were able to escape prosecution because top level rarely had an eye on the nitty gritty at the middle. This will no longer be possible.
I can't see
assumptions working in the courts. How will the court of human rights view this?
By saying its proportionate to the mischief to be cured-their stock in trade answer I'm afraid!!!
I don't think
this will make any difference because most of the schemes HMRC are trying to stop comes under "aggressive avoidance" and not evasion, hence the low prosecution rate. I presume then that HMRC will try to re-classify avoidance to evasion. Interesting scenario.
It's probably more as a result ...
... of the HSBC tax evasion scandal and other secret offshore bank accounts.
Reasonable
Once again a law is put into place with the horrendously subjective word "reasonable" as part of the definition. Cue lots of long-drawn out court cases on what constitutes "reasonable" procedures.
This may be a daft question but...
How can a 'company' commit criminal acts by virtue of its employees actions? Surely the criminal intent rests with the employees. Imprisonment of the company isn't possible, so any fine will simply be borne by the shareholders who are technically the 'company'.
How can a 'company' actually blame anybody? Isn't this more a case of senior management versus junior management?
Piercing the corporate veil. They can imprison Directors just as in any other case-so get your systems in place and have the statutory defence available. Elysium-Law Chambers can help with putting that together.
Richard Gray Barrister
In answer to John Jenkins, I assume its an offence of strict liability as opposed to conspiracy which requires intent. Oddly if I am right its the same mens rea as you (don't) have when you speed on a road. That the difference in the 'criminality' needed.