When it comes to defending business owners accused of tax fraud by HMRC, it can be a complex and challenging task for solicitors. Of course, it is far from a day at the park for the business owners either; nobody wants to submit their tax returns and receive a legal letter informing them that they are going to be audited for tax evasion. To mount a robust defence, solicitors who are trained in fraud may employ various strategies and arguments. And, as you may have guessed, there are some key ones that can be used when that error on the tax returns was just an error.
So, here are five common defences used by fraud-based solicitors when defending business owners facing tax fraud charges.
Lack of Intent
One of the primary defences employed in tax fraud cases is to establish that the business owner had no intention to commit fraud. The fraud solicitor may argue that any discrepancies or errors in tax filings were unintentional and resulted from negligence or misunderstanding of complex tax laws. They might present evidence to demonstrate that the business owner made reasonable efforts to comply with tax regulations, such as hiring accountants or relying on professional advice.
In order to prevent a fraud accusation from happening again, it may be wise to ensure that you hire an accountant to oversee your tax returns from now on. That way, you will be legally covered in case there are errors, and any issues with the returns will be put to the accountant and not your company.
Good Faith Reliance on Professionals
This defence asserts that the business owner relied on the advice and guidance of qualified professionals, such as accountants or tax consultants. Solicitors may argue that any fraudulent activity was a result of erroneous advice or misconduct by these professionals. They may present evidence of communication between the business owner and their advisors, demonstrating the reliance on professional expertise.
Procedural Errors or Technicalities
Solicitors may scrutinise the government’s case for any procedural errors or technicalities that could invalidate the charges. They may argue that the evidence collected by tax authorities was obtained unlawfully, such as through illegal searches or wiretapping. Alternatively, they might focus on procedural errors made during the investigation or the handling of the case, seeking to have the charges dismissed due to these violations.
This defence centres around challenging the strength and sufficiency of the evidence presented by the prosecution. Solicitors may argue that the prosecution has failed to provide clear and convincing evidence linking the business owner to the alleged fraudulent activities. They may challenge the accuracy or reliability of financial records, witness testimonies, or any other evidence presented against their client.
Plea Bargaining and Mitigation
In some cases, solicitors may advise their clients to consider a plea bargain to minimise potential penalties or secure a reduced sentence. By negotiating with the prosecution, they may seek to obtain a more positive outcome for their client. Solicitors may also focus on presenting mitigating factors, such as the business owner’s cooperation with the authorities, lack of prior criminal record, or financial hardship, which could influence the sentencing decision.