HMRC investigations in a changing world

HMRC continues to ramp up its taskforces and disclosure campaigns to tackle tax evasion, but many practitioners are still unsure what brought about the change of approach and how best to interact with the Revenue on behalf of clients.

Jeff Millington, a partner at Smith & Williamson and previously an inspector of taxes with HMRC Specialist Investigations, spoke at the recent AIMS Accountants for Business conference about how to deal with HMRC's ever-changing investigation strategies.

Millington revealed that with 25% staff cuts and £900m in cost savings across the department, its approach was focused on gathering even more information on people and analysing it with HMRC's Connect computer system.

By targeting high risk groups with dedicated teams and disclosure facilities, HMRC believes the strategy is starting to influence behaviour across a number of sectors.

Millington said HMRC uses this psychological approach towards people in specific trades, such as jewellers in the Midlands, to make people think they are being targeted, which encourages them to come forward and disclose.

“Letters are the main approach and usually advise that certain information is already held. They would prefer people to come forward to make disclosures, rather than HMRC chasing them down,” he said.

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Comments

Publicity    1 thanks

The Black Knight | | Permalink

Why is there no publicity? 499 cases? not heard of that many.

in fact I am sure I have seen reports that prosecutions are down this year?

You would think for all this hot air to work they would publish when they actually did some work.

The vat ones are Missing trader carousel fraud and whilst they fall under tax fraud, in nature they are just theft rather than evasion?

HMRC    2 thanks

jonmillar | | Permalink

Would not be overly  concerned - FOI request shows that  out of some 75000 staff there are less than 200 qualified accountants/auditors.  Thinly spread or what

HMRC    1 thanks

lisaK | | Permalink

There is only so much that HMR&C can do in terms of targeting, intimidation and voluntary disclosure; to generate the levels of tax required to 'balance the books' there will need to be a change in tax law to make clear what is legally acceptable avoidance and what is illegal evasion. 

It is already clear    1 thanks

The Black Knight | | Permalink

lisaK wrote:

There is only so much that HMR&C can do in terms of targeting, intimidation and voluntary disclosure; to generate the levels of tax required to 'balance the books' there will need to be a change in tax law to make clear what is legally acceptable avoidance and what is illegal evasion. 

It is already clear.

It is only politicians and the press seeking to confuse everyone, for their own ends or out of ignorance.

Evasion is a separate issue to Avoidance and the two should not be confused or even discussed in the same breath as it just confuses the Plebs.

The answer is

Evasion : Investigate and prosecute.

Avoidance : Challenge whether it works in the tribunals, then write better legislation if you don't like the outcome.