Editor in Chief (interim) AccountingWEB
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What happened with the Panama papers

15th Nov 2016
Editor in Chief (interim) AccountingWEB
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National Audit Office
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National Audit Office reports on HMRC high net worth unit

A recent NAO study into the workings of HMRC’s high net worth unit offered the first public account of how HMRC responded to the release of thousands of files on offshore asset-holders.

The progress report on the papers leaked from Panamanian law firm Mossack Fonseca is just one excerpt from a deeper study into the workings and effectiveness of HMRC’s high net worth team, which claimed a yield of £416m in 2016, up from £200m in 2011-12.

Where high net worth individuals are suspected of tax fraud, their cases are handled by a specialist team set up in 2009. In the past five years, this group investigated and closed 72 cases. The vast majority, 70, were pursued using civil powers and yielded £80m. Two criminal cases were investigated and passed to the Crown Prosecution Service.

Following the avalanche of publicity that accompanied the Mossack Fonseca leak in February, the government set up a multi-agency taskforce led by the National Crime Agency. HMRC staff from the high net worth unit worked with the taskforce, alongside specialist investigators and data analysts.

The attention devoted by the Treasury and HMRC to the scandal was big enough to delay plans to issue consultation documents on the Making Tax Digital initiative.

What the taskforce found

After sifting through the papers, the taskforce identified 40 high net worth individuals who could be in the frame for further investigation. “HMRC may find that it has already been told about the offshore assets in the leaked data, but has yet to complete the work necessary to verify this in every case,” the NAO reported.

HMRC is under pressure to demonstrate that it is getting tough with offshore tax evaders. So the number of prosecutions related to the Panama papers is likely to be higher than the 2010 HSBneeefs in ev epe- MPUer"> r-pby the Ns="ima leasSBneeefs in ev epe- MPUer"> the asSBnenC’s high n"eped">