Zoe Wyatt comments on HMRC crypto asset nudge letters in the Financial Times and City A.M.
Partner Zoe Wyatt comments on the plans by HMRC to issue “nudge” letters focusing on crypto assets, in the Financial Times and City AM.
Zoe’s comments were published in the FT and City AM, 20 October 2021, and can be found here and here respectively. Her comments were also syndicated for publication across a range of specialist trade publications.
“These nudge letters are likely to have been automated and issued to anyone that has bought and sold crypto, regardless of whether they have got their reporting and tax payments right.
“In our view, it would be fair to say that most underpayments will not have come from willful evasion, but rather ignorance. This will ring alarm bells for some who are delinquent, but not lead to wholesale disclosure – through fear of penalties and remaining ignorant as to the powers of HMRC to obtain information, and also of the account holder’s tax obligations on crypto transactions.
“HMRC are likely to have limited resources in opening enquiries into all of the taxpayer account information that they have received and would achieve greater compliance and collection of underpaid taxes if they opened a crypto tax amnesty.
“Those choosing to ignore a nudge letter now move from careless to deliberate – the consequences of which are maximum penalties and potentially criminal prosecution.”