Changes to Money Laundering Regulations – don’t be caught out

For more than 10 years certain UK businesses have been required by the Money Laundering Regulations to register for supervision from their professional body or from HM Revenue & Customs (HMRC).  Be aware, however, that the threshold at which you are required to register has decreased since June.

The previous threshold was €15,000 and has decreased to €10,000. The new regulations will mean that more businesses will be classed as High Value Dealers and will have to register for Anti Money Laundering Supervision (AMLS) for the first time.  Mitchells wants you to ensure that you’re not caught out. Regulations

High Value Dealers (HDVs) are required to register with HMRC.  A High Value Dealer is any business or sole trader that accepts, or makes, cash payments of €10,000 or more (or the equivalent in any currency) in exchange for goods. This includes a situation where a customer makes a cash payment straight into a bank account, or if cash is paid to a third party for your benefit.

Anybody considered to be a High Value Dealer needs to register with HMRC for AMLS before making or accepting high value payments. This registration does involve fees which can be paid online during application to register and upon renewal. A one-off application fee of £100 must be made when you first apply to register, and a subsequent payment of £115 for each premises you include in your application. A fit and proper test fee and an approval process fee will be charged for each person tested.

Money Laundering Regulations are in place to prevent the exchange of criminally obtained money or assets for legitimately obtained assets. Money laundering also includes money that is used to fund terrorism, however it is obtained.

Tim Leeman, partner at Mitchells Chartered Accountants and Business Advisers, explained: “Worldwide events means that HMRC is cracking down further on money laundering.  If you are required to register you should ensure that this has been done to avoid dire consequences for your business.  If you’re unsure at all about whether you need to register or how to register, then Mitchells’ expertise can help to put your mind at ease and walk you through the whole process.”

HMRC can impose anything from financial penalties to criminal prosecution to any business that fails to comply with these regulations. A guide as to who needs to register can be found at https://www.gov.uk/guidance/money-laundering-regulations-who-needs-to-register. You do not need to register if you are a member of a professional body such as the Law Society that acts as a supervisory authority, or if you are already supervised by the FCA.

If you are at all unsure as to whether or not you and your business need to register, please contact us for more information.

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