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Health Care Wealth Scare

11 January

In December 2009 we published an article highlighting HM Revenue and Customs’ (HMRC) current interest in pursuing under-declared income earned by several hundred hospital consultants by way of contacting the institutions often responsible for paying out this income. That article raised the possibility of the Revenue launching an ‘amnesty’ in respect of this undeclared income.

On 11 January 2010 HMRC fulfilled this prophecy and launched the “Tax Health Plan” (THP) – “an opportunity for medical professionals with undisclosed tax liabilities to come forward and settle their affairs”.

Similar to the New Disclosure Opportuniry (NDO) and the previous offshore amnesty, the Tax Health Plan offers reduced penalties for disclosures under the scheme followed by dedicated pursuit and harsher penalties for undisclosed income.

Key points for anyone potentially affected are:

• The window for notifying HMRC is open now and lasts until 31 March 2010. Notification may be made electronically, by telephone or by post.
• Having notified this intention, the completed disclosure, along with payment of the corresponding tax should reach HMRC by 30 June 2010.
• Where the terms and deadlines of the THP are met, a fixed penalty of 10% of the tax owed will apply.
• Where the deadlines and terms are not met, or where the income being disclosed is such that it ought to have been disclosed under a previous ‘amnesty’, these favourable terms will not apply.

Having dealt with declarations under the previous ‘amnesties’ WKH’s tax department are well placed to handle disclosures under this new plan.

If you are in any doubt as to whether you are affected by this initiative, please contact Graham Boar (gboar@wkhca.co.uk) or John Sheehan (jsheehan@wkhca.co.uk) at our Letchworth office (01462 687333) to discuss the matter further.

An Addendum: When is a medical professional not a medical professional?

Whilst HMRC billed their new Tax Health Plan (THP) as "an opportunity for medical professionals…", the apparent requirement for a GMC registration number in order to make a disclosure prompted confusion in the media as to the scope of the opportunity.

In their wisdom HMRC have bridged the uncertainty by announcing that the plan will specifically include dentists amongst its target audience.