A freelance musician friend of mine is having a bit of a tax nightmare that she's sticking her head in the sand about. It seems she hasn't been sent a tax return for some time - though she's reluctant to go into details, I get the impression from her haunted expression that it's at least five years - and is obviously very worried about the revenue catching up with her. She appears to have slipped through the net (she swears she's not even had a single letter from a tax office), but I would have thought it was only a matter of time before the taxman comes knocking. What are the advantages of coming clean as opposed to being caught? Either way I imagine she'll be bankrupted by the bill, but I gather there are penalties that may be more or less severe depending on this sort of factor. Also, if she set herself up as a limited company (as a couple of our friends suggest), how likely would the revenue be to check up on her "missing years"?
