Spot research by automotive software developer, DCML, found that 30% of dealers questioned have a robust compliance “paper trail” relating to car usage and benefit-in-kind calculations.
In February, HMRC started naming and shaming deliberate defaulters as part of its clampdown on ‘less clear cut tax avoidance issues’.
The list – which has included hairdressers, coach operators and grocers so far – is now being published quarterly.
Despite a near 40% increase in compliance investigations by HMRC during the 2011-12 tax year, which resulted in an additional £434m in tax collections and fines, the majority of the 46 dealer businesses surveyed by DCML admitted they were ‘turning a blind eye’ to the issue.
Based on DCML’s experience of dealership processes, it is clear that a significant proportion of demonstrator and courtesy car fleet usage is non-commercial.
Vince Powell, managing director of DCML, said: “It has always been seen as a perk for dealership staff.
“Unfortunately, the tradition has been flying in the face of the authorities for years and the risks to the business and individual for non-compliance are only going to intensify.”