- July 14, 2023
- Posted by: FCS Compliance
- Category: Art Market, News
Art Market News: HMRC’s Latest Fine List Totals £3.2m
Written by Rena Neville, Head of FCS Compliance – Art Division
HMRC recently released a list of 240 of their supervised businesses that suffered fines totalling £3.2m for breaching the UK Money Laundering Regulations. The penalties were assessed between 1 July and 31 December 2022.
In addition to those specifically named and shamed on HMRC’s list, there were an additional 179 companies that received smaller fines totalling more than £200,000 for various rule breaches.
Art market participants (AMPs) were included in greater numbers than in prior Name and Shame lists, but AMPs are only one rather small sector of the several larger sectors that HMRC supervise including high-value dealers, estate and letting agencies.
The number of AMPs and their fines were fewer and not as large as some of the other sectors. However, virtually all of the AMP fines imposed were for failing to register on time – which is a simple fix and easy to avoid. The AMP fines ranged from £5,000 to £13,350 and of the 15 or so that were given penalties, over half were located in London.
Of the 200 fines imposed on other sectors – excluding the art market – some 10% were due to implementation breaches with penalties ranging from just over £1,000 to more than £1m. However, as with the AMP, the vast majority of these fines were for failing to register.
Within the AMP sector, we understand that HMRC is continuing to conduct audits and issue fines. Many of the more recent fines have been as a result of an AMP’s late, but voluntary registration. Unfortunately, a late registration often triggers a fine.
However late registration essentially constitutes voluntary disclosure, which allows HMRC to exercise discretion to reduce the fine by as much as 50%; and to further reduce the fine if it is paid promptly. Although voluntary disclosure is painful as it will likely result in a fine, it is much less costly than being found out.
Article Published: July 2023