Press release -
Cross-country enquiries into suspected electronic till fraud
Takeaways across England have been subject to unannounced inspections as part of an Electronic Sales Suppression (ESS) probe.
The action by HM Revenue and Customs (HMRC) officers took place at a total of 17 different outlets in London, Ipswich, Manchester and Newcastle over the last month.
It follows several separate till fraud enquiries, which include the arrest of a 47-year-old man in Manchester on 21 February, plus voluntary interview invitations issued to 4 people in the Cheshire area.
HMRC knows some takeaways are using ESS tools which are either software or devices that alter electronic point-of-sale records. They are used to under-report a business’s sales and consequently evade tax.
On the surface, a transaction might appear to go through as normal, but ESS tools enable records to be manipulated – sometimes by deleting sales and linking to either domestic or offshore payment platforms.
To combat ESS in the takeaway industry, HMRC has robust methods in place, including accessing data from external sources, such as bank statements and transaction records from online food ordering platforms. This includes payments some platforms facilitate between takeaways and wholesalers. The information is then compared against a business's declared income to identify any discrepancies.
Anyone using, supplying, making or promoting ESS can face fines of up to £50,000 or criminal prosecution.
Those involved should come forward and use the disclosure facility on GOV.UK. The longer a business takes to disclose information, the higher the financial penalties will likely be.
HMRC also encourages anyone with information regarding ESS or any form of tax fraud to contact us online.
Notes to Editors
- Unannounced visits have been carried out by HMRC officers in recent weeks:
- Manchester – One outlet visited on 22 February.
- Ipswich – One outlet visited on 13 March.
- London – Eight premises visited between 14 & 20 March. Postcodes SE2, SM5, SE19, SW17, RM7, RM18, EN5 & KT19.
- Newcastle – Seven premises visited between 13 & 20 March.
- A 47-year-old man in Manchester was arrested on 21 February on suspicion of the fraudulent evasion of Income Tax, VAT and money laundering, before being released on bail.
- Four people in Cheshire have been invited to voluntary interviews on suspicion of being in control of a business, which failed to register for VAT.
- More information about ESS can be found on GOV.UK.
- HMRC can commence a criminal investigation into tax fraud with the view to prosecution or, if appropriate, carry out a civil investigation under Code of Practice 9 (COP9). You do not need to wait for HMRC contact – you can voluntarily admit to tax fraud through the COP9 Contractual Disclosure Facility.
- Follow HMRC’s Press Office on Twitter @HMRCpressoffice
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Issued by HM Revenue & Customs Press Office
HM Revenue & Customs (HMRC) is the UK’s tax authority.
HMRC is responsible for making sure that the money is available to fund the UK’s public services and for helping families and individuals with targeted financial support.
