Yield and Measures: Loss Prevention
Behavioural Changes as a result of LM interventions can be scored as Revenue Protected, either as Future Revenue Benefit (FRB) LPOG10300 or Loss Prevented (RLP)
Loss Prevention (RLP)
An estimate of the tax ‘saved’ to HMRC as a result of an intervention - projected and claimed for a maximum of 24 months (unless there is evidence that suggests that the Loss Prevented will not continue for the full 2 years).
Compute the actual loss prevented over 4 months then multiply it by 6 to get the effect over 24 months
Removal of Gross Payment Status on CISR (see LPOG5055). The calculation should be based on the traders record of payments received up to the date GPS was withdrawn. CIS deductions for registered subcontractors are calculated at 20%. Unless there is evidence that the business would have ceased earlier, for example where it known that all contracts would have been completed at an earlier date, calculate the RLP for 2 years.
One-off VAT Loss Prevention yield (£89,000 or £5,634) can also be recorded where:
- Following enquiries at the Pre-Registration stage, VAT registration is refused (£89,000)
- Following enquiries at the Pre-Registration stage, VAT registration is refused (£5,634) - this is for one man or small businesses who only supply the one worker involved. This category are the applications LM deal with from one man businesses or limited companies or members of LLP’s who also have applied for or likely to apply for the Flat Rate Scheme. These applications normally feature a lack of any evidence of a real business and are part of the wider disguised employment problem LM are seeing.
- A labour provider business is compulsorily de-registered for VAT purposes and veto/tax loss letters are sent to it’s main customers
Examples of range of yield claims for LP Interventions LPOG10500
Recording Loss Prevention (RLP) Yield
Results are recorded on Caseflow - guidance can be found under the Compliance Operational Guidance (COG) under Caseflow 2