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HMRC sharpens its microscope

hmrcNearly 250,000 taxpayers in the UK were the subject of tax investigations during the 2012-13 financial year.

The number of inquiries HM Revenue & Customs (HMRC) made about taxpayers it thought were not paying enough tax has doubled over the past two years, according to new figures obtained by the Daily Telegraph.

In 2011-12 a total of 119,018 inquiries were started, but in 2012-13 the number leapt to 237,215.

The number of prosecutions against tax evaders has risen, too. In 2010, there were 165 people sent to jail but only three years later the number jumped to 1,165.

As a result, HMRC has increased its revenues. A huge £20.7bn extra was collected through its greater scrutiny of tax avoidance and evasion last year, an 11% increase from 2013, official figures show.

This was the largest amount it ever brought in from challenging taxpayers. Ten years ago, the sum was £6.9bn.

Even so, the Revenue estimates that £35bn a year of tax is still lost.

HMRC has also doubled its deployment of bailiffs and debt collection agencies in the last two years.

Even so, yet new powers have been proposed for HMRC which would allow it to take money directly from bank accounts without getting a court order.

Although still under consultation, officials say rules will oblige to leave £5,000 in the bank account after the tax has been taken. The money can also be removed only after four requests for the tax owed have been ignored.

As it is, the taxman already can obtain information about a taxpayer from third parties, such as banks, credit card providers, employers and other government agencies.

The Revenue is also empowered to see the websites which taxpayers consult and check a person’s mobile phone records.

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