In July 2017, UK Private Capital held a series of workshops for GP members on the Criminal Finances Act 2017, looking specifically at the ‘failure to prevent the facilitation of tax evasion’ provisions and how this will affect venture capital and private equity firms. Members of our Tax Committee met with HMRC to discuss the issues raised and decide how we could inform our members about the legislation.
In 2019, HMRC began its first investigation into the potential offences under the provisions. The provisions make corporate bodies or partnerships criminally liable if they fail to prevent the criminal facilitation of tax evasion by their associates. The only defence for this is demonstrate that a) they had in place reasonable prevention procedure; or b) it was reasonable not to have a prevention in place.
The aim of the following documents is to highlight the scope of the legislation and how it applies to the venture capital and private equity industry, as well as portfolio company and individuals.
