UK: New Tax Evasion Law

On September 30, 2017, a new law came into effect making it easier for UK regulatory authorities to directly prosecute companies for failing to prevent tax evasion.

Legally, there are two separate offenses:

• The failure to prevent the facilitation of UK tax evasion  
• The failure to prevent the facilitation of foreign tax evasion

An offense could result in criminal proceedings and an unlimited fine.

Under the new law, companies will be criminally liable for failing to prevent tax evasion committed by employees and external agents, regardless of senior management’s knowledge of evasion. The onus is on companies to enact “reasonable prevention procedures” to prevent people associated with the company from committing related crimes. Regulations, prosecution and penalties for tax evasion remain unchanged; the new law adds to existing corporate requirements.

For more information, read our blog post “Are You Prepared for the UK’s New Tax Evasion Law?”