The UK’s tax authorities have issued an official warning to contractors to watch out for self-assessment scams - and they don’t mean IR35 for a change.
According to Her Majesty’s Revenue and Customs (HMRC), fraudsters see self-employed individuals as a good target and are pulling off a wide variety of cons around purported tax rebates. The problem peaks between now and the tax deadline of January 31, hence the warning on Wednesday.
“Over the last year, HMRC received nearly 900,000 reports from the public about suspicious HMRC contact – phone calls, texts or emails,” a release from the Revenue reads. “More than 100,000 of these were phone scams, while over 620,000 reports from the public were about bogus tax rebates.”
The biggest scam targeting the millions of self-assessment filers is a phone call from someone claiming to be from the Inland Revenue and offering a tax refund. Also prevalent is an email or text message containing a link that also claims to offer a refund. That link will “take customers to a false page, where their bank details and money will be stolen,” the British government warns.
Watch out for heavy-handed tactics too, the authorities warn, with another scam featuring someone threatening the individual with arrest or imprisonment if you don’t immediately pay a bogus tax bill.
Here’s how you know if it’s a scam: the revenue service will never directly contact you asking for bank details or passwords or PINs. It also won’t send links in texts or emails or send attachments. So if you receive any of them, they're not legit.
The reason self-employed people are being targeted by the scam is because they typically have to file their own tax return and send funds to the government themselves. Most people pay taxes automatically through their employer and so never have to go through the hassle and confusion of figuring out the over-complicated UK tax system.
By contrast, fake rebate scams and aggressive demands to pay bogus tax bills are prevalent in the US, where most people are still required to submit their own tax return.
Another thing to keep an eye out for, HMRC has warned, is copycat websites that have addresses similar to the real Revenue website. It advises that people “always type in the full online address www.gov.uk/hmrc to obtain the correct link.”
Which is not very realistic but then it doesn’t want to advise people to use Google because scammers can buy misleading ads on Google to lead netizens to the wrong site.
HMRC does have a customer protection team that shuts down such scams, apparently, and it has various reporting tools and hotlines. You can email firstname.lastname@example.org or text 60599. Or use Action Fraud’s online reporting tool.
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But if all fails, you can use this simple guide: if someone contacts you offering a tax rebate, it’s just not going to be true because in the rare event you do have one, you are going to have to grip it with both hands and pull it out the clenched fist of the Inland Revenue.
They are not going to give you money without you working for it, my friend. And they definitely aren’t going to call you to tell you that they owe you money. It’s not Chris Tarrant, it’s the flaming taxman. Get a grip.
Likewise, if you are contacted by someone demanding you pay your tax bill and they give you the option to do so quickly and simply, then it is also an obvious scam: because HMRC is utterly incapable of making anything that simple.
Now, if you have to go through a series of mindbogglingly confusing, contradictory pages filled with turgid text and are forced to spend several hours trying to figure out if you need to fill in that box or not, and if so with what information, then – congratulations – you have found HMRC’s real self-assessment platform and all is well. ®