Cheating the public revenue is a judge made criminal offence and in order to obtain a conviction the prosecution only have to show that the defendant has made a false statement with the intention of defrauding HMRC: see R v Hudson [1956] 2 QB 252. Positive acts are not required and a failure to act can still amount to cheating the revenue.

In the case of R v Mavji, 84 Cr. App. R 34 it was held by the Court of Appeal that an actual act of deception is not necessary. The defendant’s failure, in that case, to submit a VAT return or pay the VAT due was sufficient because he had done so with dishonest intent to evade tax.

In relation to income tax, the prosecution can also charge the statutory offence of being ‘knowingly concerned’ in the ‘fraudulent evasion’ of income tax under section 106A Taxes Management Act 1970.

However, the Court of Appeal held in R v Godir [2018] EWCA Crim 2294 that recklessness was not sufficient to convict someone of this offence although willful blindness as distinct from recklessness could be sufficient grounds to convict.

What matters in tax fraud cases is whether you were behaving dishonestly and intended to cause a loss to HMRC or perhaps was wilfully blind to the fact.

  • In the end whether the offence you are charged with is section 106A Taxes Management Act 1970 or the common law offence of cheating the revenue, the ultimate question will be whether there was an intent to defraud – i.e. was the Defendant acting honestly or not?

It is vital that your defence in a tax fraud case is prepared with precision and care. No detail should be considered too small and the difference between acquittal and conviction may, in the end, rest on some apparently obscure fact or explanation or by pressing for thorough disclosure and examination of the prosecution’s case.

Please contact Patrick Cannon for an initial discussion or advice.

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