An introduction to the Criminal Finances Act 2017 and how it affects the UK sports industry
All of us working in the sports industry should be aware of the new Criminal Finances Act 20171 (the Act), which provides two new strict liability offences for failing to prevent the facilitation of tax evasion - a particularly topical subject given the recent Paradise Papers revelations.
The changes are designed to overcome the difficulty often encountered by prosecuting authorities in attributing criminal liability to companies for the criminal acts of employees, agents, or those that provide services for, or on their behalf.
The consequences are extreme, with companies potentially facing an unlimited financial penalty and/or ancillary orders such as confiscation orders or serious crime prevention orders. Non-compliance will result in a criminal investigation by HMRC, which brings with it the risk of a dawn raid.
This article briefly summarises the new offences under the Act, specifically with regard to the sports industry, which remains firmly in the sights of the tax man. It goes on to describe the practical steps that should be taken now in order to minimise the risk of a criminal conviction.
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- Tags: Anti-Corruption | Bribery Act 2010 | Criminal Finances Act 2017 | HMRC | UK | United Kingdom (UK)
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About the Author
Adam leads RPC's market-leading tax disputes team and has over 25 years' experience in this area. Adam has particular expertise in advising sports clients on matters involving image rights, agents' fees, residence/domicile and Employee Benefit Trusts (EBT) arrangements. He acts on behalf of a range of high profile clients including international Premier League football players, their agents and advisors, and clubs.
Michelle Sloane is a Partner in RPC's Tax Disputes, Regulatory and Financial Crime team.
Michelle advises both corporates and individuals in respect of investigations by regulators. Michelle has particular expertise in relation to tax disputes including complex tax enquiries, tax assessments and criminal investigations. Michelle has in-depth experience of handling HMRC investigations into the sports industry, including in respect of image rights and agency fees. Michelle has conducted high value tax appeals at all levels including before the Tax Tribunals, Court of Appeal, Supreme Court and Court of Justice of the European Union. Her expertise includes Judicial Review proceedings scrutinising the conduct of regulators. Michelle also assists clients manage urgent issues such as "dawn raids".
Before moving to the UK in 2006, Michelle worked for the New Zealand government as a tax investigator and legal adviser to the tax investigations team where she gained valuable insight into the decision making process of revenue authorities