HMRC is broadening its focus on bringing in additional tax from high net worth individuals (HNWI) and has doubled the size of its specialist unit which targets ‘affluent’ taxpayers, with over 100 new inspectors coming on-board over the past two years, according to analysis by Moore Stephens
The affluent unit at HMRC has increased its headcount by 54%, up from 213 in 2012/13 to 327 in 2014/15 as the department intensifies its tax avoidance crackdown.
Moore Stephens calculates that the wage bill for affluent unit inspectors rose 68% over the same period, from £7.8m to £13.1m.
Set up in 2011, the affluent unit investigates taxpayers on income of over £150,000 per year and a net worth of at least £1m. It sits alongside the HNWI which investigates taxpayers with higher levels of wealth.
Dominic Arnold, Partner at Moore Stephens says: “This increase in headcount at the Affluent Unit is a clear indication that HMRC intends to squeeze more tax out of a wider group of taxpayers. Additional tax inspectors at HMRC will be expected to pay for themselves many times over.’
Arnold said: ‘The tax affairs of many of the taxpayers who are investigated by the Affluent Unit will be perfectly in order. Some of the measures HMRC uses to determine who faces scrutiny can be quite crude.’
Factors which may attract attention, according to Moore Stephens, include possessing property and/or bank accounts offshore; having significant property holdings in the UK; having unusually low rate of tax on total income; filing self-assessment returns late; and previous involvement in a tax planning scheme.
An HMRC spokesperson said: ‘We are better than ever at moving resource to risk as these figures of extra staff deployed tackling non-compliance clearly show. Anyone who has not paid the tax they owe should get in touch with us urgently as coming forward means a lower penalty.’
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