Undeclared Income – It’s On The Cards!

Photo businessman working with generic design notebook. Online payments, banking, hands keyboard. Blurred background, film effect. horizontal mockup

Did you know that HMRC can track your income by obtaining information about the use of credit and debit cards?

Any individual or business accepting credit or debit card payments for goods or services must be registered with HMRC, who have the power to gather information from the card processing companies.   Although no data is disclosed regarding the actual cards or cardholders, the details they receive are  used to monitor the value of sales for any business using them .  This can then be compared to the income declared on tax returns.

In order to target undisclosed income obtained in this way, HMRC have been operating a Voluntary  Credit Card Disclosure Scheme whereby anyone who has undeclared card income can come forward.  Although there are penalties, they are likely to be in the region of 10-20%, rather than the full 100% which would be levied if HMRC makes the first contact.

If you have undeclared card income, now is a good time to take advantage of the scheme while it is operating.  The first step is to contact HMRC and tell them you wish to take part, following which you have 4 months from the date of acknowledgement to make a full disclosure of all undeclared income or gains. HMRC will expect you co-operate fully with any enquiries they make, as well as remitting all underpaid tax within the time frame, to be considered for the lesser penalties.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s