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Glasgow
+44 (0)141 221 2984

Edinburgh
+44 (0)131 225 6366

Stirling
+44 (0)1786 451745

Dumbarton
+44 (0)1389 765238

Hamilton
+44 (0)1698 459444

French Duncan

HMRC's Tax & Procurement policy review: good news?

24 September 2014

The review of the policy, which came into effect from 1 April 2013, was published by HMRC on 26 August. As part of the policy, any business seeking a Government contract of £5m or more must self-certify that they have not submitted an incorrect tax return or engaged in tax evasion or tax avoidance. If the business cannot certify a “clean” record, Government departments have the discretion to exclude them from the procurement process.

Of the 65 bids applying for central Government contracts of £5m or more, one potential bidder failed the overriding mandatory procurement test. However, HMRC said this failure was due to the bidder being unable to provide and deliver services that would fulfill the procurement department’s contract, rather than an issue of whether or not they were tax compliant.

The remaining 64 potential bidders declared that they had been tax compliant. The review found that early indications are that those wishing to bid for relevant contracts are “very mindful” of the need to be tax compliant. It makes sense that you should pay the correct tax to the Government if you intend to undertake a contract with it...

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