When was the intention to publish details announced?

At Budget 2009 it was announced that legislation would be introduced in Finance Bill 2009 enabling HMRC to publish the names and details of individuals and companies who are penalised for deliberate tax defaults: incorrect returns, failing to notify, and certain VAT and Excise duty wrongdoings where the tax lost exceeds £25,000. Names will not be published of those who make a full disclosure whether unprompted or prompted.

The policy objectives are to send a clear signal that cheating on tax is wrong; to deter people from doing it; to reassure those who pay the right tax and to encourage those who do not to come forward and make a full disclosure. This was part of a wider package of compliance proposals announced at Budget 2009.

When will HMRC start to publish details?

Legislation is included at Section 94 of Finance Act 2009 and will be brought into effect by Treasury Order with the date that they have effect specified in the Order. The legislation is expected to apply for return periods or failures starting on or after 1 April 2010. No details of deliberate defaults committed prior to the legislation becoming effective will be published.

What are HMRC plans for implementation?

We are still working on the detail of this and will be seeking input from representative bodies on the practical issues. This process began with a very helpful discussion at the Publishing Details of Deliberate Tax Defaulters forum held on 15 May 2009. We expect to hold a workshop in the autumn to explore matters in more detail.

The Review of Powers Implementation Oversight Forum will play a role in overseeing prepara-tions for implementation on 1 April 2010 and in con-sidering how to evaluate the publication scheme thereafter.

What are the details of the publication scheme?

The criteria for publication are tightly defined and are linked to the new penalties for incorrect returns and penalties for failure to notify and certain VAT and excise wrongdoings which apply across the taxes and duties administered by HMRC. It will not apply to late filing or late payment penalties.

Only those who are penalised for deliberate or deliberate and concealed defaults may have their names and details published, not those who are penalised for having failed to take reasonable care. HMRC have already issued extensive guidance on the penalties, including making clear that deliberate inaccuracy is where a person knowingly and intentionally gives HMRC an inaccurate document so as to understate tax due. It does not include a reasonable arguable view of a tax situation which is subsequently not upheld.

The £25,000 limit relates to the tax on which the deliberate penalty is calculated and can cover more than one year, tax or default (but nothing before 1April 2010).

Everyone will be able to escape publication if they make a full disclosure to HMRC, either unprompted or prompted. The definitions relating to disclosure will be the same as for the penalties. The already substantial guidance on this area will be reviewed and extended if necessary to ensure there is clarity about when a disclosure will give exemption.

The publication scheme has been carefully designed to ensure it is a necessary and proportionate interfer-ence with the right to privacy in order to protect the economic well being of the country and to prevent crime. That interference has been kept to the minimum to achieve the intended aim.

What safeguards will there be?

There will be strong safeguards.

• All the penalty decisions which underpin the scheme are appealable to an independent tribunal.
• No publication is possible until all appeal opportunities are concluded or expired.
• The taxpayer must be notified in advance and given reasonable opportunity to make representations.
• We expect to send the taxpayer a copy of the details we intend to publish in advance.
• There are strict time limits: HMRC must publish within 12 months of the penalty becoming final and remove material 12 months thereafter.

The details to be published will be the minimum necessary to correctly identify the person and the default: name, address, nature of business, period covered, amount of tax and penalty. If we can identify the person correctly and avoid any confusion without the address, then this will be omitted. We anticipate publishing a list quarterly on the HMRC website with an accompanying press notice.

The presumption will be to publish if the criteria are met but there may be exceptional circumstances where HMRC will not publish, and the representations made by the taxpayer will be taken into account in this decision. Examples might include prejudice to an ongoing criminal investigation or risk to a person's security. The decision will be made by a senior HMRC officer, independent of the investigation.