HMRC flexes new muscles!

From 6 April 2012 HMRC can exercise new powers that will allow them to require a cash deposit or a bond, which can be cashed on demand, from certain employers where it is considered there is a real risk that they will not pay their PAYE and NIC liabilities.

HMRC have said that this will not affect the vast majority of employers who pay their tax on time, nor will it affect employers who are in genuine financial difficulties. Employers who may be affected include:

• Employers that deliberately choose not to pay.
• ‘Phoenix’ businesses that cease trading and then re-emerge in a different guise.
• Employers who build up large PAYE or NIC debts, and
• Employers who ignore HMRC attempts to contact them.

Readers may find the following comments from HMRC’s website useful:
HMRC will calculate the amount of the security on a case by case basis – depending on the amount of tax at risk, the previous behaviour of the employer and other risks. Those being required to pay a security can appeal against this decision.
As with VAT, if an employer fails to provide the security for PAYE or NICs, HMRC can prosecute them. The sanction is a fine, not a custodial sentence.

Original post by Latest Taxation News and many thanks to them and their entry and picture of their BMX Bike