Inland Revenue To Interview Taxpayers Under Caution

by Jason Gorringe, for LawAndTax-News.com, London

10 October 2003

The Inland Revenue's Special Compliance Office has revealed that taxpayer interviews are soon to be taped under caution following the suspension of the so-called 'Hansard procedure' opening interviews as a result of the Court of Appeal judgement in the Gill and Gill case.

The Hansard procedure, first employed back in 1944, was used as a kind of unofficial 'fast track' dispute settlement process between the Inland Revenue and the taxpayer which allowed the individual to own up to tax evasion or other misdemeanours and escape with a fine rather than a complex and lengthy investigation, an arrangement that was considered amenable to both parties.

However, in his judgment, Lord Justice Clark said "Tax fraud involves the commission of a criminal offence or offences, so that it is in our view evident that the role of the SCO investigating tax fraud involves the investigation of a criminal offence."

Lord Justice Clark added that Code C of the Police and Criminal Evidence Act 1984 (PACE) also applied to the Gill and Gill case, and that "the appellants should have been cautioned and a tape recording made of the interview".

Whilst the SCO will resume Hansard opening and post-Hansard interviews, Will Heard of Investigations and Special Tax Services told Accountingweb that these will be conducted under caution and with legal representation, which he points out will greatly increase the costs of tax investigations.

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