HMRC Deferred Prosecution Agreement: What You Need to Know
The HM Revenue and Customs (HMRC) Deferred Prosecution Agreement (DPA) is a legal agreement between HMRC and a business or individual suspected of committing tax evasion or fraud. It aims to encourage cooperation and compliance by offering a way to avoid prosecution while still holding the offender accountable for their wrongdoing.
If a DPA is offered, the offending party must admit to the wrongdoing and agree to certain terms and conditions. These may include paying fines or back taxes, implementing new compliance measures, and cooperating with ongoing investigations.
The use of DPAs by HMRC has increased in recent years, with high-profile cases resulting in significant fines and reputational damage for the companies involved. In 2019, construction firm Serco Geografix Ltd paid a £19.2 million fine after entering into a DPA with HMRC following allegations of fraud.
Critics of DPAs argue that they allow businesses to avoid full accountability for their actions, while proponents argue that they are a necessary tool for encouraging cooperation and preventing further wrongdoing.
If you or your business are being investigated for tax evasion or fraud, it is important to seek legal advice and consider all options before entering into a DPA with HMRC. While it may offer a way to avoid prosecution, it also requires admission of guilt and significant financial penalties.
In conclusion, the HMRC Deferred Prosecution Agreement is a legal tool used by the government to encourage compliance and cooperation in cases of tax evasion and fraud. While controversial, it has been used successfully in high-profile cases to hold offending parties accountable and prevent further wrongdoing. If you are facing an investigation, it is important to consider all options and seek legal advice before entering into a DPA.
