Revenue fraud

Common law, Customs and Excise Management Act 1979 (sections 50, 170 and 170B), Fraud Act 2006, s.1, Taxes Management Act 1970 (section 106A), Theft Act 1968, s.17, Value Added Tax Act 1994 (section 72)
Effective from: 1 October 2014

Fraud 

Conspiracy to defraud (common law)

Triable on indictment only

Fraud Act 2006 (section 1)

Triable either way

Maximum: 10 years’ custody

Offence range: Low level community order – 8 years’ custody


False accounting

Theft Act 1968 (section 17)

Fraudulent evasion of VAT; False statement for VAT purposes; Conduct amounting to an offence

Value Added Tax Act 1994 (section 72)

Fraudulent evasion of income tax

Taxes Management Act 1970 (section 106A)

Fraudulent evasion of excise duty; Improper importation of goods

Customs and Excise Management Act 1979 (sections 50, 170 and 170B)

Triable either way

Maximum: 7 years’ custody

Offence range: Band C fine – 6 years and 6 months’ custody


Fraud Cheat the public revenue (common law)

Triable on indictment only

Maximum: Life imprisonment

Offence range: 3 – 17 years’ custody

User guide for this offence


Step 1 – Determining the offence category

The court should determine the offence category with reference to the tables below. In order to determine the category the court should assess culpability and harm. The level of culpability is determined by weighing up all the factors of the case to determine the offender’s role and the extent to which the offending was planned and the sophistication with which it was carried out.

Culpability demonstrated by one or more of the following:

A – High culpability

  • A leading role where offending is part of a group activity
  • Involvement of others through pressure/influence
  • Abuse of position of power or trust or responsibility
  • Sophisticated nature of offence/significant planning
  • Fraudulent activity conducted over sustained period of time

B – Medium culpability

  • Other cases where characteristics for categories A or C are not present
  • A significant role where offending is part of a group activity

C – Lesser culpability

  • Involved through coercion, intimidation or exploitation
  • Not motivated by personal gain
  • Opportunistic ‘one-off’ offence; very little or no planning
  • Performed limited function under direction
  • Limited awareness or understanding of extent of fraudulent activity

Where there are characteristics present which fall under different levels of culpability, the court should balance these characteristics to reach a fair assessment of the offender’s culpability.

Harm – Gain/intended gain to offender or loss/intended loss to HMRC
Category 1 £50 million or more Starting point based on £1 million
Category 2 £10 million–£50 million Starting point based on £30 million
Category 3 £2 million–£10 million Starting point based on £5 million
Category 4 £500,000–£2 million Starting point based on £1 million
Category 5 £100,000–£500,000 Starting point based on £300,000
Category 6 £20,000–£100,000 Starting point based on £50,000
Category 7 Less than £20,000 Starting point based on £12,500