£15m recovered from charity tax crimes

OECD research reveals extent of tax evasion, tax crimes and money laundering in the sector

HM Revenue & Customs recovered £15m from charity tax evaders in 2007, according to a report by the Organisation for Economic Co-operation and Development.

Report on Abuse of Charities for Money-laundering and Tax Evasion, published two weeks ago, says tax evasion and fraud involving charities is "a serious and increasing risk in many countries".

The OECD, a group of 30 member countries that discusses and develops economic policy, investigated 19 countries in May last year.

The report says tax evasion and tax crimes have been discovered in the UK and that money laundering is also thought to have taken place, although there is "not currently any firm evidence".

Although it cannot accurately quantify the economic cost of tax fraud to the UK, the report says the schemes relating to direct tax that have been found and challenged are "in the tens of millions".

HMRC's charities tax team and criminal investigators work with the Charity Commission to fight tax cheats.

"Sentences ranged between two and four years and confiscation proceedings have been used in order to recover the proceeds of the criminal conduct," says the report.

It also says "large-scale schemes are unusual but not unknown", but adds: "There has been some negative publicity, but the integrity of the charity sector has not yet been seriously damaged."

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