Fraud Investigations by HMRC ‘Brought in £600m Since 2016’
Investigations carried out by HMRC into fraudulent activity have brought in more than £600 million to the Treasury since 2016.
According to a newly released set of data on the subject, COP8 and COP9 investigations led to the retrieval of around £610 million in the tax years between 2016/17 and 2018/19.
The numbers have been published by the accountancy firm Saffery Champness following the approval of a Freedom of Information (FOI) request.
A total of 1,473 COP9 and 924 COP8 investigations are now known to have been conducted by HMRC since 2016, with the latter yielding £262 million to the Treasury and the former resulting in £348 million in extra payments that might otherwise not have been made.
COP9 investigations relate to suspected criminal activities and instances in which serious fraud is thought to have taken place, while COP8 probes focus on civil cases where deliberate but not criminal examples of tax avoidance are potentially to be found.
According to Saffery Champness, HMRC has become increasingly proactive in terms of how it aims to tackle tax avoidance, in part because it has been empowered to do so by new legal tools.
The accountancy firm has suggested that the taxman now also has more information about individuals and about potential tax evaders or avoiders than it ever has had in the past.
“HMRC will also be learning as they go, gathering more information and testing new powers through the courts – as we have seen recently with the IR35 cases – and will continue to strengthen their resources for tackling tax evasion,” said Zena Hanks, a partner and private wealth expert at Saffery Champness.
“Individuals who are concerned they might not be compliant should seek advice and potentially take advantage of disclosure facilities provided by HMRC.
“The quicker mistakes are corrected the better the opportunity to resolve the mistake and minimise the penalties that HMRC can levy.”
Ms Hanks points out that sometimes HMRC opens its enquiries into what it thinks might be instances of fraudulent activity or tax evasion based on what later proves to be incorrect information.
“In these circumstances, swift action should be taken to close down any such enquiry and to protect the taxpayer from unnecessary angst,” she says.
