Credit Cards to Help Uncover Evaders

September 4, 2013 Taxation in UK

Credit CardLONDON – The HMRC will soon start sifting through data on credit card transactions in an effort to catch out business owners who try to hide their incomes.

As of September 3rd the HM Revenue and Customs can access credit card transaction data from merchant acquirers, obtaining much greater power to fight the occurrence of tax evasion, and potentially having the chance to collect an extra GBP 50 million in taxes per year.

Over the course of this week all of the UK’s merchant acquirers, the organizations which process credit card payments, will receive written requests to hand over all transaction data for the last four years, and similar annual requests will also be made every year into the future.

The requested data will contain details of the number and the value of transactions received by businesses in the UK, but will not contain any information on the names or credit card numbers of the purchasers.

The collected information will be integrated with the HMRC’s already operating Connect cross-checking system, which analyzes nationally available information to uncover discrepancies between actual spending, transactions, and reported incomes.

The new data gathering powers were granted in the Finance Act 2013, which received Royal Assent in July 2013.

Photo by Philip Taylor PT