Law firms face new exposure to tax evasion charges as Criminal Finances Act nears go-live date

Partners warn firms will have to ramp up their due diligence efforts ahead of new legislation coming into force at the end of the month

City partners have warned that law firms must pay “very close attention” to who they do business with to ensure they do not fall foul of the new Criminal Finances Act, which will usher in a new corporate offence of failure to prevent tax evasion later this month.

The Act, which comes into force on 30 September, will make law firms vicariously liable for criminal tax evasion by ‘associated persons’ – including contractors, suppliers, agents or lawyers at other firms – if they do not implement reasonable procedures to prevent the facilitation of criminal tax evasion.

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