When the economy is in recession the opportunity for scams increases.

With so many people suffering from falling income the idea of a get-rich-quick scheme is more attractive and can catch normally sound-thinking individuals off guard.

We are all familiar with the corrupt official, usually in Nigeria, who has access to several million dollars worth of cash but can only transfer it out of the country with your help and your bank details.

More recently, Bernard Madoff was sent to jail for the biggest Ponzi or pyramid-selling scheme in history.  Even sophisticated investors were caught out by this scam.

Many e-mails have been sent out purporting to be from HM Revenue & Customs and indicating that a certain taxpayer (who is not you or someone known to you) is being investigated for unreported or under-reported income.  These are all scams designed to encourage you to click on the link that looks like an official site but is, of course, a fake site set up for the purpose of collecting personal or bank details from you. These are then used by the fraudsters to attack and/or empty your bank account.

Tempting as it is to reply to these scam e-mails, the best thing to do is to ignore them.  HMRC suggest that they are forwarded to phishing@hmrc.gsi.gov.uk and HMRC will try to stop more of this type of e-mail being issued.  HMRC never send out e-mail reminders of this type, nor do they send out e-mail reminders that your tax return is late, a payment is overdue or that you are being investigated for fraud.

What HMRC will do is

·         charge you £100 if your self-assessment tax return is not submitted online before 31 January each year

·         add 5% penalty to your tax bill if the money or the tax return is not sent in by 28 February

·         add a further 5% penalty if the tax or return is not paid by 31 July

·         add further charges, including possible fines of £60/day, for the  worst offenders.

As a cost-saving measure, avoiding these fines sounds like a good idea.