Tax Rebate Fraudsters Arrested Attempting to Steal £0.5m

HMRC investigators worked closely in cooperation with their Italian counterparts to identify and arrest five men in the United Kingdom. These men were subsequently charged with cheating the revenue by obtaining personal data with the intention to steal large sums of false tax rebates also known as tax refunds.

The men were arrested in London, at Stansted airport, together with simultaneous searches being carried out across London, Chatham, and Italy. The suspects have been released on bail, pending further enquiries into whether they attempted to defraud the tax payer.

Andrew Sackey, Assistant Director, Criminal Investigation for HMRC, said:

“These arrests clearly demonstrate that we can, and will, apprehend those suspected of attempting to cheat UK taxpayers by defrauding HMRC, with international assistance if necessary”

What are Tax Rebates or Tax Refunds?

A tax rebate is a tax refund where the taxpayers’ tax liability is less than the taxes owed to HMRC. Taxpayers can often get a tax refund if the tax they owe is less than the sum of the total amount of the withholding taxes and estimated taxes they paid, plus the refundable tax credits that they claim.

What are Tax Rebates through the Self-Assessment Scheme?

If you have overpaid tax in the current financial year, you can claim your tax back or leave the overpayment in your self-assessment account to be set off against future tax losses. Taxpayers can ask HMRC to make a refund to themselves, their agent or nominee (since 6 April 2012 you can no longer make repayments to charity for any year). This can be done under the self-assessment scheme through the HMRC website.

How does the Tax Rebate Scam Work?

The scam is designed to illegally obtain personal data from third parties in order to steal large sums of overpaid tax through the self-assessment scheme. Fraudsters often steal valuable information such as national insurance numbers, addresses, passports numbers and most importantly credit or debit card numbers, expiry dates and CSV numbers and use this information to steal large amounts of tax rebates.