Revealed: £1.9 billion tax ‘owed’ by super-rich probed by crack team at HMRC

National Audit Office reveals scale of HMRC team - and slow progress


Nearly two billion pounds in taxes thought to be owed by the super-rich is being investigated by a crack team of government revenue officers, with more than half this money linked to aggressive tax avoidance schemes.

The National Audit Office (NAO) reports the specialist team of HMRC tax collectors – which is also probing 40 names from the Panama Papers – looked into around 6,500 people each worth over £20 million last year, with an average of four tax issues for each person.

A possible £1.9 billion in unpaid taxes dating back years is being investigated with around £1.1 billion linked to tax avoidance schemes, and 15 per cent of the wealthiest having used at least one.

But progress has been slow, with 4,000 inquiries open for more than three years.

HMRC has looked into and closed 72 cases of tax fraud by high net worth people over the last five years, with only two criminal investigations and one conviction.

Prime Minister Theresa May has vowed to tackle big companies and rich individuals paying less than their fair share of taxes, while the Labour Party has said these missing tax billions should be spent on public services.

HMRC’s crack team, which is also looking at 40 people named in the Panama Papers, gives a ‘customer relationship manager’ to those being probed to catch tax dodging. It raised an extra £416 million beyond tax declared by the rich in 2015/16.

Labour MP Meg Hillier, who chairs the Public Accounts Committee, said:

“For the ordinary taxpayer, HMRC’s use of ‘customer relationship managers’ will sound rather a cosy way for HMRC to engage with the richest people in the country; people worth over £20 million each.

However, I am pleased to see HMRC is beginning to link these individuals to the businesses and trusts they are also involved in, to help tackle the £1.9 billion of tax that is potentially at risk.”

The NAO report found the super-rich, who are 0.02 per cent of taxpayers, paid more than £4.3 billion in tax in 2014/15.

It also said 137 of the country’s richest agreed to pay a million pounds each in 2009 as part of a settlement over undisclosed assets in tax haven Liechtenstein, after admitting liabilities of £141 million in return for softer penalties.

An HMRC spokesman said:

“Everyone must pay the tax that is due and we do not accept less.

HMRC enforces the rules impartially and last year we tracked down an additional £416 million in tax from the wealthiest, which would have otherwise gone unpaid.

We will continue to evaluate our results so that we carry on getting what is due to the country.”

See: Britain is on the road to being a corporate tax haven

See: Does Amber Rudd believe in a ‘society that works for everybody’?

See: Nigel Farage wants to cut taxes for big firms like Apple – some man of the people!

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5 Responses to “Revealed: £1.9 billion tax ‘owed’ by super-rich probed by crack team at HMRC”

  1. Alasdair Macdonald

    This is an area where HMRC must redeploy its staff more effectively and, indeed, employ more. ‘Benefit fraud’ is less than 1% of the totally budget and HMRC deploys several thousand staff to this. Tax evasion and aggressive tax avoidance is estimated to lose the Exchequer around 1/3 of the potential tax take, but HMRC deploys only several hundred staff.
    When there is a two way flow of staff between HMRC and various large accountancy companies which specialise in ‘tax efficiency’ there is a system in which ‘loopholes’ are created to make the avoidance ‘legal’. The law needs to be tightened to enable more convictions are obtained and that as well as recovering avoided and evaded taxes, there are also punitive penalties.
    Finally ‘tax havens’ in Channel Islands and various Crown territories must be closed down.
    Where are all the potential press stories which should be a consequence of the Panama Papers?

  2. Mick

    There’s nothing wrong with tax havens, just so long as you obey the law.

    Also, the benefit cheats only taking 1%, real or claimed, are bound to be greater in number. And what do they put back into the economy? How many jobs do they create? If there is any justification to accuse any government – Labour or Tory – of being lax on rich tax dodgers, there may be an element of reciprocation to consider.

    So what would happen if we went back to Old Labour’s system of punishing the rich, as well as everyone else, in their bank accounts? Well, read your history books and rediscover how this country became victim to militant trade unionists crashing everything further.

  3. Alasdair Macdonald

    Well, of course there is something wrong with tax havens. The laws which Mick says should be obeyed are written to provide this fig leaf of cover. Secondly, those who use them are not paying their share of the costs of public services, such as education.
    With regard to the dehunanisingly styled, ‘benefit cheats’ Mick is making a false comparison with tax dodgers. The scale is hugely different. By jibing about job creation in relation to those he is excoriating, he is creating a red herring. The issue is job destruction by those who use tax havens, to create impoverishment – the majority of those receiving tax credits and other (nugatory entitlements) are in work, often, several in one family – and to weaken trade unions and then to create poorly recompensed employment, with shaky job security, and maximise profits which are stashed in tax havens. Austerity is a means of transferring wealth and power from the many to the few. There are trillions of pounds stacked in the coffers of big businesses, which should be redistributed throughout the population to create spending power and demand and get a properly vibrant economy which benefits all.
    Mick is clearly a propagation of post truth mendacity.

  4. Alasdair Macdonald

    ‘Propagator’, not ‘propagation’ – apologies for failing to spot the autocorrection.

  5. Mick

    Austerity is a result of the last Labour government wasting the money it previously stockpiled in taxes, presiding over a recession it made worse by selling most of our gold at rock bottom prices, then having nothing to cover the Credit Crunch.

    There have indeed been many new harder laws against rich tax evaders. The Labour government were the ones soft on rich tax dodgers as Blair and Brown coined in the huge party donations. SO there are laws to obey and rules to observe. Bitching on class war issued does nobody any favours.

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