Taxes collected from investigations into wealthy individuals soared to a record high in the last year, with leaks from the Panama Papers and new global data sharing agreements boosting Britain’s Treasury coffers.
HMRC’s yield from probes into wealthy individuals jumped 58 per cent to a record £1.9bn in 2018/19, according to new research from law firm Pinsent Masons.
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Probes in the wake of the Panama Paper revelations, which involved an unprecedented data leak revealing new information about secretive offshore tax regimes, have yielded an extra £190m.
“HMRC’s data-led approach is proving incredibly effective – the taxman’s reach has never been longer than it is now,” said Steven Porter, partner at Pinsent Masons.
He added: “The surge in yield from investigations may also reflect HMRC’s multi-faceted approach to compliance amongst wealthy individuals. Data is used to cross-check returns and sometimes letters are simultaneously pumped out asking individuals to confirm information they don’t need to confirm – mistakes can easily be made which can leave taxpayers exposes to investigations.
“HMRC’s willingness to not only investigate but also enforce and prosecute, shows its continued use of the stick over the carrot when pursuing wealthy individuals.”
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According to Pinsent Masons, HMRC’s efforts to improve efficiency have been aided by the Common Reporting Standard (CRS) in which more than 100 countries have now agreed to share financial data.
In 2018 alone CRS flagged the accounts of three million UK taxpayers.