HMRC now have a special unit examining the tax affairs of UK resident individuals whose income or wealth is increasing very rapidly: but who are not yet candidates to be dealt with by the High Net Worth Unit or the Affluence Compliance Team: the so-called tax “Rising Stars”.
HM Revenue and Customs’ Rising Star Unit was formed in 2012. In 2012/13 it carried out 38 tax investigations, bringing in extra revenue (i.e. tax, interest and penalties) f £4.9 million. In 2013/14 it carried out 51 tax enquiries with yield of £6.6.M – an average or around £130,000 per tax investigation.
The ranks of the taxman’s Rising Stars are likely to be heavily dominated by: young premiership footballers; popstars and other music industry figures (e.g. DJs); film and television actors (and similar celebrities); city traders and hedge fund managers; along with entrepreneurs of fast-growing businesses (e.g. computer gaming and social media businesses).
In addition to the Rising Stars team, HMRC has 2 other specialist tax compliance teams with extra dedicated resources to examine the tax affairs of the wealthy. The “Affluent Compliance Team” targets the 30,000 taxpayers with annual income over £150,000 or wealth between £2.5M- £20M. The “High Net Worth Unit” targets the richest 6,200 individuals: typically those with wealth over £20 million.
What does it mean for me?
If you’re a young person with rapidly growing income or wealth you are increasingly likely to be targeted by a specialist investigation unit. Also, if you are a colleague of anyone who has already been investigated by that unit (or say you share the same agent or tax or financial adviser) then you are also more likely appear on HMRC’s radar. Of course, this doesn’t mean that you have done anything wrong. But HMRC are extremely intrusive in their enquiries, and will be putting a lot of skilled effort into probing your financial affairs. Unless the enquiry is properly managed on your behalf you are likely to have a lot of disruption: and potentially a very large tax bill to pay at the end of it.
How can Lynam Tax Enquiry Experts help me?
The tax investigation specialists at Lynam Tax have a massive amount of experience in dealing with tax enquiries by HMRC’s specialist units. We are currently assisting a number of premiership footballers with their tax enquiries. The taxman is using highly skilled, dedicated specialists to look at your affairs. You need to be represented by equally experienced and highly skilled tax advisers.
If you, or one of your clients, is undergoing a tax enquiry do not hesitate to call for a free initial consultation:
Paul Lynam: 0845 643 9997
Andrew Nutbrown: 07718 778710