HMRC targets takeaways over electronic till fraud

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HMRC targets takeaways over electronic till fraud

Related tags Hmrc Tax Delivery & takeaway QSR

More than 20 takeaways and restaurants in Edinburgh, London, St Helens and Stoke have been subject to unannounced visits as part of a crackdown on electronic till fraud.

The action by HM Revenue and Customs (HMRC) officers took place over the last four weeks, with 24 hot food takeaways and restaurants targeted.

The visits coincided with the launch of criminal investigations by HMRC’s Fraud Investigation Service, which is conducting three interviews under caution this month with individuals from Stoke and St Helens.

A small minority of takeaways and restaurants in the UK are using Electronic Sales Suppression (ESS) tools, which are software or devices that alter electronic point-of-sale records, according to HMRC. They are used to underreport a business’s sales and consequently evade tax.

“ESS tools give businesses the appearance of trading legitimately, but in reality they are stealing tax that should be helping fund our vital public services," says Marc Gill, HMRC’s director of individuals and small business compliance.

“We have sophisticated ways of detecting this type of fraud and anyone using, supplying, making or promoting ESS can face fines of up to £50,000 or criminal prosecution."

ESS tools are usually hardware or cloud-based software that allow businesses to understate their income in various ways. Sales are put through the till as normal, but the system allows records to be manipulated – sometimes by deleting sales and linking to either domestic or offshore payment platforms.

To investigate ESS in the takeaway and restaurant sector, HMRC uses third party information, including bank account and transactional data from online food ordering platforms, to check against what has been declared.

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