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HMRC warns firms over shifting profit


HMRC has issued warning letters to multinational companies, saying those shifting profits to other jurisdictions to cut their British tax bill must review their operations and change incorrect practices. The letters, which mark the return of a clampdown that had been paused because of the coronavirus pandemic, say that investigations often find that “profits do not reflect the value created in the UK”, with tax investigators seeing "indications of careless or deliberate behaviour requiring penalties to be considered". Firms have been given 90 days to review their operations and submit any relevant information to HMRC. The Revenue estimates that 2,000 large businesses with operations in the UK may owe a total of £34.8bn in taxes for 2019/20 financial year, up from £29.9bn in 2018/19.

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