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VAT offences is an offence that can come with a stiff punishment. This article provides detailed guidance on the typical sentencing for this offence.

What is the sentence for VAT offences in 2023?

Investigations into VAT offences are initiated by the Police, the HMRC tax office, the Office of Fair Trading or the courts.

Being accused of committing VAT offences can be very stressful. There will be a feeling of dread and worry about what might happen next; will there be a prison sentence issued if a conviction is made? Being imprisoned can mean that you cannot maintain relationships or provide a consistent income for your dependents.

To make matters worse, it’s not just the above-listed organisations who are interested in an offence of this nature. There may also be interest from:

  • Serious Fraud Office (SFO)
  • National Crime Agency (NCA)

The trouble with VAT offences is that they can be time-consuming to investigate, and this can create a negative impact on any business both operationally and financially. To lessen the impact and potentially attain a positive outcome, it is vital to put a legal team in place which has experience of VAT offences and of liaising with the above agencies. In some cases, assets might be frozen, and a Restraint Order applied. You may have cash seized or assets confiscated.

Any financial offences are typically incredibly complicated and hard to defend. Only those who specialise in this area of law can craft a robust defence strategy.

The two acts that VAT offences charges are brought under are the Fraud Act 2006 and Section 72 of Value Added Tax Act 1974.

There are several offences for which you may be accused, including:

  • Tax evasion
  • Money Laundering
  • Fraud
  • Theft

Any of these crimes may play a part in your case. For this reason, you must seek the legal guidance of a competent fraud solicitor who can skillfully defend you.

For you to understand more about your situation, we have put together some questions and answers about sentencing for VAT offences. Please note that a competent and experienced solicitor may be able to get a prison sentence reduced or even avoid it entirely.

What type of actions are considered VAT offences?

Here are some examples of VAT offences that may have led to the situation that you or a loved one are now finding yourselves in.

Solely taking cash from customers – for instance, so that VAT payment is avoided.

The requesting of payment to be made outside of the business – for example, making it necessary to pay another person or company.

Not registering for VAT – if you own a business, or you earn over £85,000 a year as a sole trader, you are required to register for VAT.

Falsely claiming to have registered for VAT – even if a person claims to have asked for a VAT number, but they haven’t got one, they are breaking the law.

Using a VAT number that is not yours – for instance, using a fake name or a number that belongs to somebody else is against the law.

Not paying VAT when you are required to is a form of tax evasion and an offence that is taken very seriously by HMRC.

What is the average sentence for VAT offences?

If your case reaches Court and you are convicted of VAT offences, you may be sentenced for a maximum of 7 years and receive a fine of up £20,000.

The following is an extract taken from the Sentencing Guidelines which are provided to judges to help them decide on penalties.

The level of culpability is determined by weighing up all the factors of the case to determine the offender’s role and the extent to which the offending was planned and the sophistication with which it was carried out.

Culpability demonstrated by one or more of the following

A – High culpability

  • A leading role where offending is part of a group activity
  • Involvement of others through pressure, influence
  • Abuse of position of power or trust or responsibility
  • Sophisticated nature of offence/significant planning
  • Fraudulent activity conducted over sustained period of time
  • Large number of victims
  • Deliberately targeting victim on basis of vulnerability

B – Medium culpability

  • A significant role where offending is part of a group activity
  • Other cases that fall between categories A or C because:
    • Factors are present in A and C which balance each other out and/or
    • The offender’s culpability falls between the factors as described in A and C

C – Lesser culpability

  • Involved through coercion, intimidation or exploitation
  • Not motivated by personal gain
  • Peripheral role in organised fraud
  • Opportunistic ‘one-off’ offence; very little or no planning
  • Limited awareness or understanding of the extent of fraudulent activity

Where there are characteristics present which fall under different levels of culpability, the Court should balance these characteristics to reach a fair assessment of the offender’s culpability.


Harm is initially assessed by the actual, intended or risked loss as may arise from the offence.

The values in the table below are to be used for actual or intended loss only.

Intended loss relates to offences where circumstances prevent the actual loss that is intended to be caused by the fraudulent activity.

The following is an extract taken from the Sentencing Guidelines which is referred to by judges when making decisions on penalties.

Risk of loss (for instance in mortgage frauds) involves consideration of both the likelihood of harm occurring and the extent of it if it does. Risk of loss is less serious than actual or intended loss. Where the offence has caused risk of loss but no (or much less) actual loss the normal approach is to move down to the corresponding point in the next category. This may not be appropriate if either the likelihood or extent of risked loss is particularly high.

Harm A – Loss caused or intended
Category 1 £500,000 or more Starting point based on £1 million
Category 2 £100,000 – £500,000 or Risk of category 1 harm Starting point based on £300,000
Category 3 £20,000 – £100,000 or Risk of category 2 harm Starting point based on £50,000
Category 4 £5,000 – £20,000 or Risk of category 3 harm Starting point based on £12,500
Category 5 Less than £5,000 or Risk of category 4 harm Starting point based on £2,500
Risk of category 5 harm, move down the range within the category

What are some of the mitigating factors that might reduce the VAT offences sentence?

When a tax investigation takes place, it can typically expand as other areas of your tax affairs may also need to be examined—for example, corporation tax, personal tax and more. The role of the VAT offences solicitor will be to guide you on what to do and say in response to HMRC’s requests for information.

Certain aspects of a case are known as the mitigating aspects which can influence the sentence that a judge gives. In VAT offences cases, they may include:

  • Whether the defendant is disabled or mentally ill
  • The age of the defendant, i.e. if they are very young, their age may affect their level of responsibility
  • If there are previous, relevant or recent convictions
  • Suspect shows a considerable level of genuine remorse
  • A previous good character with exemplary conduct
  • If there is a learning disability or mental disorder linked to this offence
  • There have been demonstrative steps made to address this behaviour

Is it possible to reduce a sentence for VAT offences with a guilty plea?

In recent years, several changes have been made to the sentencing system in the UK to save the court time and cost and to protect witnesses from the stress of needlessly going through a trial. For offenders aged 18 and over, pleading guilty early on in a case can reduce a sentence by as much as one third (maximum). The later the plea is entered, the smaller the reduction.

‘Early on’ refers to ‘the first stage of the proceedings’ and means anytime up to and including the first hearing at the Magistrates Court or Crown Court for indictable offences.

If a plea is entered 14 days after the first hearing, for example, the maximum level of reduction is just 20% or one-fifth of the sentence. For indictable offences, the limit for a guilty plea to be made is within 28 days after the prosecutor has stated compliance with section 3 of CPIA 1996 and serving disclosure; although the decision is ultimately in the hands of the Judge who has the discretion to apply whatever credit is deemed appropriate.

After these times, there is a sliding scale of credit applied. This goes down to one-tenth on the first day of the trial and to zero if entered during the trial. In theory, the ten per cent could be given if the plea is issued after the opening speeches on the first day, but prior to any witness evidence being heard.

If the accused does not want to plead guilty, then it’s essential for the solicitor to regularly inform the Court throughout the trial of the reasons why the client’s plea is not guilty.

What are some of the other consequences of VAT offences offence?

Ancillary Orders

A court can also make ancillary orders on a defendant if they are found guilty and convicted of an offence. These are extra elements that can be added to a sentence and include additional restrictions or requirements that affect a dependent’s finances, property or activity.

Ancillary orders that are typically added to the penalty for those who are found to be guilty of VAT offences include:

As part of your investigation, you may also have your assets frozen with the possibility of having cash or other assets seized.

Besides, the Court may demand payment of the following if the accused is convicted:

Payment of costs applied for by the prosecutors

Although the Police meet some of the costs involved in the prosecution, the costs of investigation are typically sought from the convicted. These may include the costs of:

  • The work done in obtaining enough evidence for prosecution either at the initial stage or later at the request of Crown Prosecution Service (CPS)
  • Seeking medical or expert evidence as part of the investigation, (where a witness is required to attend Court, the cost of the attendance falls on the CPS).
  • Re-interviewing witnesses
  • The entire costs of the prosecutor, including fees for the use of external Barristers used by the CPS, can be recovered from the defendant, subject to means. At the end of the case, the prosecutor under The Prosecution of Offences Act 1985 will request the Judge to order a sum to be paid for the costs incurred by the prosecutor in bringing the prosecution.

Victims surcharges

The term victims’ surcharges can be explained as paying compensation to a fund for victims and can range between £20 to £170 depending on what sentence you were given at conviction.

How sentences can be added to national information databases

Several national databases hold information about individuals and any allegations made about them, their criminal and court records. These include the DBS (Disclosure and Barring Service) which was previously known as the CRB (Criminal Record Bureau) and the Police National Computer (PNC).  Depending on what happened, whether the accused is convicted and what sentence was issued, the accused may be added to one or all these databases. Their purpose is to provide information to potential employers and to regulate the ability to take part in certain activities.

If your case progresses to Court and you are convicted of VAT offences and defrauding the HMRC tax office, your conviction will be noted on your CRB / police record. The period of the endorsement will depend on the nature and length of your sentence.

Below are details on how long you will be listed as holding a criminal record if convicted. This is something severe to consider when it comes to future employment. The term ‘spent’ refers to when your name can be removed from the databases.

Rehabilitation Period
(the time it takes for the sentence to become ‘spent’)
Sentence Adult (aged 18+) at time of conviction Young person (aged under 18) at time of conviction
Prison sentences of more than 4 years Sentence is never spent Sentence is never spent
Prison sentences of more than 2.5 years (30 months) but less than 4 years Sentence length 7 years Sentence length 3.5 years
Prison sentences of more than 6 months but less than 2.5 years (30 months) Sentence length +4 years Sentence length +2 years
Prison sentences of less than 6 months Sentence length + 2 years Sentence length +18 months
Conditional Discharge Length of order Length of order
Absolute Discharge None None
Conditional Caution 3 months 3 months
Simple Caution / Youth Caution None – immediately ‘spent’ None – immediately ‘spent’
Other Including Compensation Order, Supervision Order, Bind Over, Hospital Order Length of the order / once compensation is paid Length of the order / once compensation is paid

How Can Stuart Miller Solicitors Help?

Every client that we take on with a VAT offence is usually highly concerned about their situation. To be blunt – having the HMRC and the Police after you is frightening. Being legally represented by somebody who has the experience and complete understanding of VAT offence trials and the law in this field is vital.

Stuart Miller Solicitors are known for their competence and experience of cases related to VAT offences and tax evasion. Not only can we boast a deep understanding of the Criminal Justice Act, but over thirty years of representing defendants in this complex area of law has its rewards in terms of knowledge.

Our legal team includes many fraud solicitors, and they have some of the brightest minds and best connections in London. Using forensic accountants, witness experts, Barristers and QCs, we can negate some of the crippling effects by applying some of the most potent defensive measures from day one.

There’s no avoiding the fact that these investigations can be significantly lengthy, and drenched in vast amounts of evidence that is complex. Getting good advice in the early stages can save you from months of painful consequences. In some cases restraint orders and confiscation orders can be avoided. Adverse effects on your family may be bypassed.

Arrest & Interview

If you are arrested, charged or you find out you are under investigation, get in touch with us immediately.

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We invite you to have a no-obligation conversation with us about your situation where we can address some of your concerns.

If you are already at the police station, then we can represent you and work on securing your legal aid. If you do not qualify for legal assistance, then you should know that our prices are highly competitive and we do not add on any unexplained and unexpected charges, where possible.

Use our contact form and ask to speak with our VAT offences lawyers and tax evasions solicitor in person, or on the phone. You may wish to contact us by using the WhatsApp link visible if you view our page from a mobile phone.

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