The Criminal Finances Act 2017 - Corporate Criminal Offence

Under the Criminal Finances Act 2017, commonly referred to as the Corporate Criminal Offence (CCO) a business will have committed a criminal offence if it fails to prevent an associated person of it from facilitating tax evasion.

Anyone performing services for or on behalf of the business is an associated person, such as an agent, intermediary, subcontractor or employee.

Therefore this wide reaching legislation can cause a business to assume liability for the criminal facilitation acts of its employees and other associated persons if the tax evasion takes place at a time when they are acting in their capacity as an associated person of that business.

Where HMRC deems that an offence has taken place, a prosecuted business faces severe penalties, which can include:

  • A limitless financial penalty
  • Significant adverse publicity and reputational damage
  • Public record of the criminal conviction upon the business

The defence a business can have against a CCO prosecution is to demonstrate and satisfy HMRC that they had ‘reasonable’ procedures in place to prevent the facilitation of tax evasion.

At AAB, we are assisting numerous clients in order to support them to ensure they have in place such ‘reasonable procedures’; and we offer various packages to suit each individual business's requirements.