Parliament calls for corporation tax crackdown

Date: 21st October 2008

Parliament has urged HM Revenue and Customs (HMRC) to come down hard on those businesses which avoid corporation tax.

According to the House of Commons public accounts committee, over a quarter of the UK's largest 700 companies did not pay corporation tax to HMRC in the 2005/06 tax year.

As well as this, the select committee hit out at the disparity in amounts that larger businesses are paying in taxation to the government.

The committee said in statement: "[HMRC] should … increase the number of penalties for companies engaged in serious avoidance activity."

HMRC responded by saying that the department had cut the number of open enquiries by over 50 per cent since April last year, with the volume of cases focused on low-risk issues down by almost 90 per cent.

Small business start-ups have until the end of the month to submit a paper self-assessment tax return to HMRC, or alternatively, until January 31st if filing online.