BEWARE! VAT Fraud warning

HMRC has confirmed fraudsters are using a VAT form to intercept VAT repayments.

The issue arises when paper form VAT484 is used to update the repayment details, which includes the businesses contact information, return dates and bank details. The fraudsters are replacing the genuine bank details with their own. 

HMRC said ‘We are taking action on the small number of cases where paper bank variation forms have been fraudulently used in an attempt to gain access to VAT repayments. We’re putting measures in place to stop this from happening, while asking businesses to remain vigilant.’

HMRC writes to businesses when their details are changed, but the confirmation letters don’t state that it’s the bank details that have been amended. The recommendation is that if you receive a letter of this kind, particularly if it’s unexpected, you check the bank details in your business tax account to ensure they are legitimate.

It would also be advisable to regularly check your bank details remain unaltered, and your bank account if you’re waiting for a repayment. If it seems to have taken longer than expected, any fraud should be identified quickly.

In the meantime, HMRC are instigating additional checks on changes to bank details in an attempt to reduce the risk.

Our view is that, given these changes can be made online already, the option to use a paper form should be removed, or that HMRC should implement an equivalent to the Companies House PROOF scheme, which precludes the use of paper forms for those businesses who choose to protect themselves.

If you’re in any way unsure about the security or accuracy of the data within your Business account, our advice would be to contact HMRC immediately. We all need to be one step ahead of those trying to commit VAT Fraud.