You should only raise the possible application of ICTA88/S577A
if you find clear signs that it may be relevant.
ICTA88/S577A (1) deals with payments that are in themselves
criminal. Raising the possibility of a disallowance for the payer
necessarily means you are suggesting they may have committed a
crime. This should not present a difficulty where the courts have
already found the payer guilty of an appropriate offence.
Alternatively, legal advice may be provided which states that
the payment in question was not criminal. If so, ask to see both
the request for advice and the advice itself. Either or both should
set out the facts on which the advice is based. You should then
normally close the enquiry if the legal advice is unequivocal and
apparently of good standing.
However, the technical position may be much less clear cut
where the crime, if there is one, has not come to the attention of
the courts and there is no other conclusive legal advice. You
should therefore refer to CT&VAT (Technical) for advice at an
early stage.
Sometimes, however, the payer's inability to provide
satisfactory evidence about the nature of payments, or the payee's
name and address, may be a sufficient reason for seeking a
disallowance.
Where possible pass on details of bribes etc paid to the recipient's district so that any tax liability can be considered.
HMRC has a legal gateway for sharing information with the police
and certain other enforcement authorities in the Anti-Terrorism,
Crime and Security Act (ATCSA) 2001. This gateway allows the
disclosure of information which will be used for the purposes of a
criminal investigation or proceedings, or for the initiation or
termination of an investigation or proceedings. If you have
uncovered information about criminal activity in the course of your
work, you should consider disclosing it to the police through this
gateway.
All disclosures of information under ATCSA must be made
through the Centre for Exchange of Intelligence (CEI). They will be
able to advise you on whether the information should be shared with
the police and the processes involved in doing so. You should not
disclose other than under CEI’s direction.
For further details on disclosing information to enforcement
authorities, see IDG60150. You can find details of how to contact
CEI at
(The text at this point has been withheld under the Code of
Practice on Access to Government Information).
Where payments are made to foreign residents, you should
consider whether this information may be of assistance to an
overseas revenue authority (e.g. the payment may be taxable income
in the hands of the recipient). The guidance on providing
information to overseas revenue authorities under a double taxation
agreement can be found at INTM156010 et seq.
Again, all disclosures must be made through CEI.
