Card Transaction Programme

Card Transaction Programme

In our last blog, we looked at the Requirement to Correct campaign currently underway with HMRC. There is another important campaign running too and it’s called the Card Transaction Programme.

In HMRC’s words, the Card Transaction Programme allows “businesses that accept card and cash payments and haven’t reflected all transactions in a return, to bring their affairs up to date and take advantage of the best possible terms.”

They’re looking for:

  • non-declaration of card payments, cash payments, internet orders, and phone orders by businesses registered with them, and
  • non-declaration of card payments, cash payments, internet orders, and phone orders by businesses NOT registered with them


Card Transaction Programme – how will HMRC possibly find out?

Don’t underestimate the snooping powers available to HMRC.

HMRC have spent £100m on their Connect software system. Connect allows HMRC to aggregate, store, and analyse data from the following sources –

  • Bank accounts and financial institutions (including from 60 other countries)
  • Child benefit payments
  • Council tax
  • DVLA
  • Earnings (from any employer)
  • Ebay, Amazon, Gumtree, Etsy, Airbnb
  • Facebook
  • Instagram
  • Land Registry
  • Maintenance payments
  • Previous tax investigations
  • Previous tax returns
  • Twitter
  • VAT
  • Visa and Mastercard transactions

In the new online world, we leave significant financial digital footprints. Connect uses an algorithm to determine whether what we spend money on matches with the lifestyle and expenditure that HMRC believes someone with a certain declared income should be able to afford.

If you have been taking electronic payments and not declaring them, sooner or later HMRC will find out.

And it’s going to get far more forensic in the future. The vast majority of tax investigations are still triggered by problems with Self Assessment returns. However, Connect will soon incorporate learning artificial intelligence algorithms meaning that more anomalies will be spotted together with interim computer-generated reports on what lines a tax investigator should pursue with an individual.


Card Transaction Programme – how will disclosure work?

If you already file Self Assessment forms, HMRC will consider that you “have taken care to make sure your tax affairs were correct”. That said, they will look back over your last 4 tax years for errors.

If an investigator decides that you have not taken reasonable care, they will examine your last 6 years’ worth of tax affairs.

If you have not told HMRC that you started a business and/or they decide you made deliberate mistakes, they will go through your last 20 years’ worth of tax with a fine-tooth comb.


Card Transaction Programme – what fines will non-compliance bring?

If you volunteer to join the programme, that’ll bode well for your dealings on the subject with HMRC. At the very least, you will have to pay the tax that you owe.

The question now is how HMRC will treat you. Will they…

  • want to look back over your records for 4 years, 6 years, or 20 years?
  • impose a 100% or 200% fine in addition to your unpaid tax?
  • fine you £3,000 for failing to keep adequate records of your business?


Card Transaction Programme – your next move

If you need to join the Programme, how you join it is going to be a determining factor in your treatment at the hands of HMRC.

Approach the Smart Team today. Let us represent you in your dealings with the taxman. Within 90 days of your joining, we’ll need to present a full disclosure on all of your business activity that HMRC does not know about.

We’ll present them with an offer, work out what you can pay them now (with a view to securing a Time to Pay agreement if money is tight), and prepare a dossier full of the information they’ll want to know about.

Call Smart Team today in confidence on 01202 577 500 or email us on

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