HMRC's April 2023 ,one-to-many, letter campaign targets businesses using Electronic Sales Suppression (ESS) tools, such as software, to deliberately manipulate electronic sales records and hide the value of individual transactions.
ESS tools artificially reduce the recorded turnover of the business, evading tax, while producing a credible audit trail which appears correct and complete.
The one-to-many letters now being issued indicate that HMRC have information suggesting that the recipient has misused their till system. Affected taxpayers are invited to make a disclosure within 30 days.
- Disclosures may be made via the ‘make a disclosure about misusing your till system’ service on GOV.UK.
- In some instances, disclosure via the Contractual Disclosure Facility (CDF) may be preferable from the taxpayer's perspective.
- Where businesses that have used ESS tools do not make a disclosure, HMRC may open an investigation or issue an assessment.
- Higher Penalties are then likely to apply.
- Businesses in receipt of a letter that do not have undeclared sales should email HMRC accordingly, using the details given in the letter.
The campaign is expected to continue for at least a year.
Useful guides on this topic
Penalties: Electronic Sales Suppression
What penalties apply for till tampering or Electronic Sales Suppression (ESS)?
Making a tax disclosure (Digital Disclosure Service)
A practical guide to making a tax disclosure using HMRC's online system.
Contractual Disclosure Facility (CDF)
What is HMRC's Contractual Disclosure Facility (CDF)? How does it work? What must taxpayers do under the CDF?
External link
CIOT: HMRC One to Many letters - Electronic Sales Suppression
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