Simon York, HMRC’s Deputy Director Individuals and Public Bodies, discusses the new teams set up to tackle tax avoidance and evasion by wealthy individuals.

In this difficult economic climate it is vital that everyone pays their fair share of taxes. Here at HM Revenue & Customs (HMRC) we are committed to making sure that they do.

One area we are focusing our efforts on is targeting evasion and avoidance by “affluent” individuals – broadly those with income over £150,000 or with wealth between £2.5m and £20m.

Wealthy tax cheats are now being targeted by the Affluent Unit, a new 200-strong team of investigators and technical specialists who started work last month.

Bringing together experts from across the department, the Affluent Unit will use new and innovative risk assessment techniques to identify areas where wealthy individuals are avoiding and evading taxes and duties.

The unit will focus on sectors where we think there is high risk of non-compliance, use intelligence from a range of sources and look for indicators of likely avoidance or evasion. One of the first groups being targeted are wealthy individuals who own land and property abroad. The Affluent Unit will go about targeting this group by applying sophisticated data mining techniques to publicly available information in order to identify individuals who own property abroad. The team will then use HMRC risk assessment tools to highlight those people who do not appear able to afford the property legitimately, as well as those who do not appear to be declaring the correct income and gains from the property.

Looking ahead we are also developing work to target commodity traders and people holding offshore accounts. Much of this work will be undertaken in co-ordination with other teams from across HMRC, including those who deal with corporate entities, residence and domicile issues, and trusts and estates. We will be announcing further details in due course.

The creation of the Affluent Unit - together with the existing work of the High Net Worth Unit which handles customers with assets of over £20m - underlines HMRC’s commitment to tackling tax evasion and avoidance across all areas of the economy. It is part of the £917m investment the Government allocated to HMRC in the last Spending Review to help reduce the tax gap over the next four years. The Affluent Unit is expected to deliver a yield of over £500m over this period.

With HMRC’s increased capability and expertise, and our growing success in tackling evasion both at home and offshore, the message is clear: there is no hiding place for tax cheats. 

Article Added Sunday, 20 November 2011 | 1195 Hits

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