HM Revenue and Customs has issued an alert about people paying in takeaways on cards after raids took place discovering chip and pin machines had allegedly been tampered with. The HMRC swooped in unannounced inspections as part of an Electronic Sales Suppression (ESS) probe.
The action by HM Revenue and Customs (HMRC) officers took place at a total of 17 different takeaways around the county – in a bid to seize equipment which they believe may have been altered. HMRC said that some takeaways are using ESS tools which are either software or devices that alter electronic point-of-sale records. They are used to under-report a business’s sales and consequently evade tax.
The HMRC said that when a person pays for their food by card on the surface, a transaction might appear to go through as normal, but ESS tools enable records to be manipulated – sometimes by deleting sales and linking to either domestic or offshore payment platforms.
Raids took place in London, Ipswich, Manchester and Newcastle over the last month. The decision to launch the major probe followed several separate till fraud enquiries, which include the arrest of a 47-year-old man in Manchester on 21 February, plus voluntary interview invitations issued to 4 people in the Cheshire area.
HMRC said that their current methods of tackling the ESS fraud include accessing data from external sources, such as bank statements and transaction records from online food ordering platforms. This includes payments some platforms facilitate between takeaways and wholesalers. The information is then compared against a business’s declared income to identify any discrepancies.
Anyone using, supplying, making or promoting ESS can face fines of up to £50,000 or criminal prosecution. An HMRC spokesperson said: “Those involved should come forward and use the disclosure facility on GOV.UK. The longer a business takes to disclose information, the higher the financial penalties will likely be.”
HMRC also encouraged anyone with information regarding ESS or any form of tax fraud to contact them online here. Unannounced visits have been carried out by HMRC officers in recent weeks:
Manchester – One outlet visited on 22 February. Ipswich – One outlet visited on 13 March. London – Eight premises visited between 14 & 20 March.
Newcastle – Seven premises visited between 13 & 20 March. A 47-year-old man in Manchester was arrested on 21 February on suspicion of the fraudulent evasion of Income Tax, VAT and money laundering, before being released on bail.
Four people in Cheshire have been invited to voluntary interviews on suspicion of being in control of a business, which failed to register for VAT.
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