Wednesday, September 2, 2009

"Tax evaders nabbed on facebook"

This is a headline doing the rounds at the moment. It reflects a development to which I referred on this blog last February: HMRC investigating posts on social media.

In the US, even the Wall Street Journal is reporting that:
"Tax deadbeats are finding someone actually reads their MySpace and Facebook postings: the taxman".
It is only a mater of time before tax evaders in the UK are caught in exactly the same way. I'm not sure how easy it would be to start with entries on a 'social' network and track back to see if the person concerned is fully declaring their business profits or is claiming excess tax credits.

On the other hand it could be relatively easy to source all sorts of data and evidence from the internet when someone is being investigated for alleged tax or benefits fraud. Remember that Google is a history book because "Google never forgets" (as noted in this 2005 article). At some stage in the future HMRC may well look back and identify incriminating blogs, tweets and comments you have posted online. These may evidence:
  • an earlier start date of your business than you had previously disclosed;
  • more extensive activities (and profits?) than previously disclosed;
  • the personal nature of trips claimed to be for business purposes;
and so on.

The following are simply examples of trails that we leave and which could help identify possible tax evaders:
  • Adsense account with Google
  • Business page on facebook
  • Business promotion on BT Tradespace or other online business forums
  • Promotion of your own services through twitter or other blogging platforms
  • Business focused online profile on Ecademy, LinkedIn or any of the hundreds of other online forums and 'social' networks
  • Affiliate links and adverts on your website or online profiles - eg: for Amazon
  • Blog boasting re business and promotional activities
And then there are the trails of friends which, as the WSJ reports can enable the taxman to track down suspected tax evaders and benefit cheats.

Please add your thoughts and other suggestions below - if you dare! Remember the taxman could be watching....

1 comment:

  1. The taxman has been using the internet for snooping for years hence the E-bay and paypal projects