HM Revenue & Customs (HMRC) has launched a disclosure facility for businesses to come forward and admit to undeclared sales using their till or Electronic Point of Sale device. The deadline for making a disclosure is 9 April 2023.

Electronic Sales Suppression (ESS) systems enable users to hide or reduce the true value of their sales via specialist software, computer code script or hardware.

Last May, HMRC targeted thirty businesses across nine counties to tackle ESS. Shops, restaurants and takeaways were visited as far apart as Scarborough and Canvey Island. Two men and a woman were arrested in Nottinghamshire as part of a criminal investigation into the alleged supply of ESS software.

Then, shortly before Christmas, a further five people were arrested in the UK, this time in an internationally co-ordinated joint action with Australia, Canada, France and the USA. An ESS system designed and sold by a group in Staffordshire was the focus of attention, with HMRC’s Director of Fraud Investigation, Simon York, quoted as saying:

‘This was a highly sophisticated truly global attack on the UK and our international partners. The group behind this activity is suspected of enabling thousands of businesses to evade tax in what is a large-scale, technologically enabled fraud.’

HMRC is now trawling through all the computers, digital devices and paperwork it has seized during the two separate probes and is seeking to identify the businesses who have been using ESS software. The disclosure facility is an opportunity for businesses caught up in this activity to come forward and put matters right with HMRC, before HMRC begins further, potentially more draconian enforcement action.

We have vast experience in assisting clients with complex disclosures and investigations. You can contact Independent Tax on 0800 001 6686.