HMRC have published a boastful pamphlet this week to publicise “record revenues for the UK” coming directly from its “crackdown on tax dodgers”; and claiming to have brought in “a record £23.9 billion in additional tax revenue as a result of increased activity”.

The HMRC “Fast Facts: Record Revenues for the UK” document, published this week, gives details of the increasing success of HM Revenue &Customs’ tax compliance activities.

Key areas of success included:

Prosecutions: You’re Nicked! Between April 2010 and March 2014, HMRC prosecuted 2,650 individuals for tax crimes, achieving 2,005 convictions; a conviction rate of 76%.

Financial Penalties: Hit ‘em where it hurts! HMRC has charged tax geared financial penalties on 11,500 deliberate tax evaders since April 2011.

Cash from Criminals: Kick a man when he’s down! When thinking about prosecutions for tax crimes most people only consider the risk of going to prison.  Many don’t realise that in addition to any sentence imposed by the courts, Her Majesty’s Revenue &Customs will also seek a Confiscation Order in order to collect the lost tax, and other costs.  Since April 2010 the taxman has bagged £4.1 billion as a result of Confiscation Orders in Criminal Tax Investigations.

Deliberate Defaulters Programme: The Tax Offenders Register.  Since February 2013 the taxman has publicly named and shamed over 60 individuals, in cases of deliberate tax default of over £25,000 and where taxpayers did not cooperate with the HMRC tax investigation.

Managing Serious Defaulters:  Tagging Tax Cheats. HMRC has placed 5,200 individuals and businesses in this programme since 2010: “closely monitoring known rule breakers to 5 years”.

Tackling Offshore Evasion: You can run but you can’t hide! Through the various Offshore Disclosure Facilities 56,000 people have made voluntary disclosures worth over £1.3 billion: including £11 million from one individual in the Liechtenstein Disclosure Facility.  Additionally, HMRC are now proactively using the information they have gathered from various overseas banks etc, and since December 2012 have sent Tax Enquiry letters about offshore bank accounts to over 17,000 UK residents.

Cyber Sleuths: Data Analytics: HMRC proudly boasts of its “award-winning data analysis system, Connect”.  It claims Connect can “map an individual’s unique financial fingerprint and identify discrepancies between what we know and what they’re declaring”.  Since 2008, the targeted tax investigations generated by Connect produced £3 billion of additional tax revenue.

Rich Pickings: The High Net Worth Unit: In April 2010 HMRC created this new specialist unit to deal with the affairs of the UK’s 6,000 wealthiest individuals: people whose net worth was over £20 million.  Tax enquiries into individuals dealt with by that unit have netted HMRC additional tax of £853 million.

Large Businesses: The bigger they come… The biggest slice of the cake comes from tax enquiries into the UK’s largest business, where an extra £31 billion has been collected since April 2010.

What does this mean for me?
If you are subject to an HMRC tax enquiry, or worried that your tax affairs are not in order, then HMRC are hoping to send out a warning sign that their success rate is climbing dramatically.  They’re hoping to create a climate where people are sufficiently concerned about being caught that they will come forward and make voluntary disclosures.  At the moment, there are various time limited disclosure facilities and tax amnesties available to people who step forward voluntarily; in order to achieve settlement with the taxman on favourable terms.

How Can Lynam Tax Disclosure Experts Help Me?
HMRC’s continuing success in tax investigations stems from its use of specialist teams.  Lynam Tax Enquiry Experts are specialists in their field; and we will use our vast knowledge and expertise to help you through these difficult times.  If you have a worrying tax enquiry, or a tricky tax dispute, or if you are considering making a disclosure, please don’t hesitate – call our experts now:

Paul Lynam: 0845 643 9997
Andrew Nutbrown: 07718 778710