Economic Crime Levy

The Economic Crime Levy is a fixed fee paid by medium and large-sized entities that are subject to Money Laundering Regulations. This will include accountants, auditors and tax advisors. Registration, filing and payment are due by 30 September.

At a glance

The Economic Crime (Anti-Money Laundering) Levy was introduced by s53 FA 2022.
The ECL will be collected by 1 of 3 collection authorities:

the Financial Conduct Authority (FCA)
the Gambling Commission (GC)
HMRC

You must register, if your UK revenue is £10.2 million or more in a financial year and either:

- Your business is already regulated by HMRC, the FCA or GC for anti-money laundering purposes or
- Your business is regulated by a professional body for anti-money laundering purposes
When you have register you will receive an Economic Crime Levy registration number.
The levy annual return and your payment are due by 30 September each year.
The levy applies to individuals, partnerships as well as companies.
The amount payable will be determined by reference to their size based on their UK revenue from periods of account ending in the prior financial year, adjusted for short periods.

Size	UK Revenue	Levy
Small	Under £10.2m	nil
Medium	£10.2m to £36m	£10,000
Large	£36m to £1bn	£36,000
Very large	Over £1bn	£250,000

The first payments will be due on 30 September 2023 with reference to accounting periods ending in the financial year to 31 March 2023.

Registration & filing

Business must register in order to be able to submit a return.

ECL registration via HMRC's online service is now possible.
- Taxpayers will be issued with an access code to enable them to complete the registration process.
Online filing of the return is now available using the Government Gateway user ID used for registering the business.

Overview

How to prepare for the Levy

There are three collection authorities which may look to collect the ECL, these are:

HMRC.
The Financial Conduct Authority (FCA).
The Gambling Commission (GC).

Entities whose revenue exceeds £10.2m that are regulated by HMRC, including those regulated by certain professional bodies for anti-money laundering purposes (full list on separate tab) will need to:

Register with HMRC.
Submit annual returns to HMRC
Pay an annual fee to HMRC.

Entities regulated by the FCA and GC will need to follow their procedures which are beyond the scope of this note. Businesses supervised by both HMRC and another professional body should register, file and pay with the other body, not HMRC.

Who must register

Entities who need to consider registration are legal persons including:

Individuals.
Companies.
Limited Liability Partnerships (LLPs).
The responsible partners in a partnership.

Each entity that is part of a corporate group will need a separate registration. Only those entities meeting the requirements need register.

Partnerships must register at the partnership level.

Tax agents cannot register their clients for the ECL. Registration must be completed by the entity itself.

Registration is only required if:

UK income is in excess of £10.2m in the accounting period ending in the prior financial year to 31 March.
The business is already regulated by HMRC or a professional bosy for anti-money laundering purposes.

Registration is a one-off occurrence but filing (see below) is annual.

The income amounts can be adjusted on a daily apportionment where regulated activities are carried out for only part of the year or the accounting period ending in the financial year is short.

New businesses that do not have an accounting period ending in the financial year need to use the accounting period that ends within three months of the end of the financial year.

It is expected that businesses in the following sectors will need to register:

Credit institutions.
Financial institutions.
Auditors, insolvency practitioners, external accountants and tax advisers.
Independent legal professionals.
Trust or company service providers.
Estate agents and letting agents.
High value dealers, casinos, auction platforms and art market participants.
Cryptoasset exchange providers and custodian wallet providers.

Registration is via the Government Gateway.

When registering the business will need to provide:

Information about UK revenue for the last financial year
The date when the organisation started anti-money laundering-regulated activities, if in the past financial year.
The business sector operated in.
Information about the accounting period length .

The following information will also be required about a designated person in the business (for contact purposes):

Name.
Role.
Email address.
Telephone number.

Additional information about the business willl also be required, depending on what type of entity is registering, for example, Unique Tax References (UTRs), registration numbers, National Insurance numbers etc.

Once registered, an ECL number will be provided and it will be needed for the annual return.

Note that if you are registering more than one entity, you will need to create a separate Government Gateway User ID and password for each one.

Amendments to the registration can be completed from the ECL account, once created.

Submitting a return

Registration is requied before a return can be submitted. Returns need to be submitted online by 30 September following the end of the financial year for which the return is due (1 April to 31 March).

Payment also needs to be made by 30 September.

Returns need to report:

The length of the relevant accounting period.
The UK revenue for that accounting period.
Whether regulated activity started or stopped in the prior financial year and the length of time the activities continued.
Which band the entity is in and the ECL due.

The person completing the form also needs to provide the following information:

Name
Role (in the organisation)
Contact details

Anyone registered for the ECL must file a return, even if the income threshold has not been met in the relevant year and no payment is required.

Filing is online and the Government Gateway user ID used to register will be required.

Once a return has been submitted, a 14 digit number will be issued, starting with an X. This number will be needed in order to pay the ECL.

Returns can be amended after submission via the ECL account.

The bands

The amount of the ECL depends on the UK revenue in the accounting period that ends in the prior financial year.

Size	UK Revenue	Levy
Small	Under £10.2m	nil
Medium	£10.2m to £36m	£10,000
Large	£36m to £1bn	£36,000
Very large	Over £1bn	£250,000

The levy may be apportioned if regulated activities are only undertaken for part of the financial year.

Paying the Levy

The ECL must be paid by 30 September each year. Where this falls on a weekend, payment should reach HMRC by the end of the previous working day.

Penalties and interest may be charged for late payment.

Payment should not be made until the relevant ECL return has been submitted. In order to make payment, the entity's 14-character ECL return number, starting with an X, will be needed. This can be found:

In the entity's HMRC online account.
On the ECL return submission confirmation email from HMRC.

Payment may be made by bank transfer, via direct debit (set up through an HMRC online account) or by using a credit or debit card. There is also a 'pay by bank account' option that is usually an instantaneous transfer and links to the taxpayer's online banking account. See below for HMRC bank account details:

Account details to use if your account is in the UK

sort code — 20 05 17
account number — 40204374
account name — HMRC General BT Receipts

Account details to use if your account is overseas

account number (IBAN) — GB86 BARC 2005 1740 2043 74
bank identifier code (BIC) — BARCGB22
account name — HMRC General BT Receipts

It is possible to request a refund of the ECL, online, where either too much is paid in error or the ECL return has been amended, reducing the amount payable.

List of professional bodies

Small print & links