Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, pursuant to the Answer of 13 June 2025 to Question 57939 on Investment: Fraud, what criteria HMRC uses to determine whether a tax liability arising from an investment scheme promoted through fraudulent means constitutes a genuine tax liability.
Answered by James Murray - Chief Secretary to the Treasury
I refer the honorable Member to the response to UIN 57939.
Where an individual disagrees with HMRC’s decision on their tax liability, they can appeal by requesting HMRC reviews the decision, use an Alternative Dispute Resolution process in appropriate cases, or by making an appeal to the independent tax tribunal.
HMRC appreciates and recognises dealing with tax, financial hardship, or debt can lead to pressure on people. All HMRC advisers are given training and guidance on how to identify customers who need extra help and how to provide tailored support themselves or refer the customer to HMRC’s specialist extra support provision.
In January HMRC published its approach to dealing with agents, which has established the Standard for Agents, and is currently consulting on enhanced powers to tackle non-compliance facilitated by tax agents. It will publish guidance shortly, which will set out its approach to preventing and addressing intermediary harm and also support customers to identify signs of harmful intermediary behaviour, including fraud.
In April HMRC launched a new Compliance Interactive Guidance Tool on GOV.UK to help customers more easily find guidance on compliance checks and extra support available, particularly for unrepresented customers and those with extra support needs.
Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, pursuant to the Answer of 13 June 2025 to Question 57939 on Investment: Fraud, whether HMRC has a formal process for reviewing tax demands issued to individuals who have been identified as victims of financial fraud.
Answered by James Murray - Chief Secretary to the Treasury
I refer the honorable Member to the response to UIN 57939.
Where an individual disagrees with HMRC’s decision on their tax liability, they can appeal by requesting HMRC reviews the decision, use an Alternative Dispute Resolution process in appropriate cases, or by making an appeal to the independent tax tribunal.
HMRC appreciates and recognises dealing with tax, financial hardship, or debt can lead to pressure on people. All HMRC advisers are given training and guidance on how to identify customers who need extra help and how to provide tailored support themselves or refer the customer to HMRC’s specialist extra support provision.
In January HMRC published its approach to dealing with agents, which has established the Standard for Agents, and is currently consulting on enhanced powers to tackle non-compliance facilitated by tax agents. It will publish guidance shortly, which will set out its approach to preventing and addressing intermediary harm and also support customers to identify signs of harmful intermediary behaviour, including fraud.
In April HMRC launched a new Compliance Interactive Guidance Tool on GOV.UK to help customers more easily find guidance on compliance checks and extra support available, particularly for unrepresented customers and those with extra support needs.
Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether HMRC has issued tax liability demands to people who have been victims of investment fraud; and what steps she is taking to review such cases to avoid penalising victims of financial crime.
Answered by James Murray - Chief Secretary to the Treasury
HMRC is responsible for managing the tax system and is required by law to collect tax due. It must apply the law correctly and individuals are responsible for their own tax affairs.
Where individuals find themselves with unexpected tax bills as a result of taking bad advice from a third party on an investments scheme, this does not mitigate any tax that is legally due.
HMRC works with individuals to understand the facts of each case and only pursues tax where there is a genuine tax liability. It tailors its approach to individual circumstances and takes a supportive and proportionate approach to recovering tax due, including offering ‘Time to Pay’ instalment arrangements where appropriate, and providing extra support for customer who need it.
Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment her Department has made of the effectiveness of redress mechanisms for victims of investment fraud.
Answered by Emma Reynolds - Secretary of State for Environment, Food and Rural Affairs
Protecting the public and businesses from fraud requires a unified and co-ordinated response from government, law enforcement and industry. The Government committed in its manifesto to introduce an expanded Fraud Strategy, and will set out further details in due course.
To better protect consumers from fraud, in October 2024 the Payment Systems Regulator (PSR) introduced a mandatory reimbursement requirement for authorised push payment (APP) scams, which may include investment scams, that take place over the Faster Payments System. This regime requires all Payment Service Providers in scope to reimburse victims of APP scams up to the value of £85,000. The PSR has noted that in the first three months of the regime, 86% of money lost to APP scams was returned to victims.
Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what fiscal steps she plans to take to support small businesses in market towns.
Answered by Emma Reynolds - Secretary of State for Environment, Food and Rural Affairs
Small businesses are vital to high streets and communities, and essential to the success of the government’s growth mission.
At the 2024 Autumn Budget, Government announced generous tax reforms to support small businesses. Most notably, more than doubling the employment allowance to £10,500; commitments in the Corporate Tax Roadmap to maintain the Small Profits Rate and marginal relief at their current rates and thresholds; and freezing the small businesses multiplier for 2025/26.
The Government also announced changes to inheritance tax, including reforms to business property relief (BPR). The Government has protected smaller family businesses from BPR changes, providing a very significant level of relief with the first £1 million of business assets continuing to receive 100% relief and then 50% thereafter.
The Government has also committed £250m in 2025-26 for the British Business Bank’s small business loans programmes, including Start Up Loans and the Growth Guarantee Scheme.
We have also extended funding for Growth Hubs across England in 2025-26, meaning businesses in market towns can access free expert advice and support.
Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the British Hair Council's report entitled Securing the future of UK hairdressing and beauty: the economic, fiscal & societal case for VAT reform, published in February 2025, whether she has made an assessment of the potential economic benefits of reducing the VAT rate to ten per cent for labour-based services .
Answered by James Murray - Chief Secretary to the Treasury
VAT is a broad-based tax on consumption, and the 20 per cent standard rate applies to most goods and services. VAT is also the UK’s second largest tax, forecast to raise £180 billion in 2025/26.
Tax breaks reduce the revenue available for vital public services and must represent value for money for the taxpayer. Exceptions to the standard rate have always been limited and balanced against affordability considerations.
Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment she has made of the implications for her policies of the report entitled Avoiding the Cliff Edge: Considering possible options for a VAT threshold smoothing mechanism, published on 9 January 2024.
Answered by James Murray - Chief Secretary to the Treasury
The Government will continue to bear in mind businesses’ views of this threshold. At £90,000, the UK has a higher VAT registration threshold than any EU Member State and the second highest in the OECD. This keeps the majority of UK businesses out of VAT altogether. The Government will continue to bear in mind businesses’ views of this threshold.
Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if she will conduct a review of the VAT system as it applies to (a) the hair and beauty sector and (b) other labour-intensive industries.
Answered by James Murray - Chief Secretary to the Treasury
VAT is a broad-based tax on consumption, and the 20 per cent standard rate applies to most goods and services. VAT is also the UK’s second largest tax, forecast to raise £180 billion in 2025/26.
Tax breaks reduce the revenue available for vital public services and must represent value for money for the taxpayer. Exceptions to the standard rate have always been limited and balanced against affordability considerations.
Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact of VAT on the financial sustainability of hair and beauty salons.
Answered by James Murray - Chief Secretary to the Treasury
VAT is a broad-based tax on consumption, and the 20 per cent standard rate applies to most goods and services. VAT is also the UK’s second largest tax, forecast to raise £180 billion in 2025/26.
Tax breaks reduce the revenue available for vital public services and must represent value for money for the taxpayer. Exceptions to the standard rate have always been limited and balanced against affordability considerations.
Asked by: Sarah Bool (Conservative - South Northamptonshire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if she will make an assessment of the potential merits of reducing VAT rate on hair and beauty salons.
Answered by James Murray - Chief Secretary to the Treasury
VAT is a broad-based tax on consumption, and the 20 per cent standard rate applies to most goods and services. VAT is also the UK’s second largest tax, forecast to raise £180 billion in 2025/26.
Tax breaks reduce the revenue available for vital public services and must represent value for money for the taxpayer. Exceptions to the standard rate have always been limited and balanced against affordability considerations.