Research by UHY Hacker Young reveals that HMRC investigations in 2020/21 yielded no returns in 47% of cases – up from 31% from the previous tax year.
HMRC has invested an estimated £100m in software to support its investigations work, but the low success rate for investigations suggests the digital approach to risk assessment may not be excluding the lowest risk taxpayers.
Graham Boar, partner at the firm commented: ‘HMRC has a strong track record in collecting money from additional compliance checks, raising £13.6bn last year. But as it aims to close the tax gap, too many people are getting caught in its net. Taxpayers need reassurance that there is a valid reason for an investigation to be opened into their affairs and that time and stress isn’t wasted on cases that will yield no results.’
Research by UHY Hacker Young reveals that HMRC investigations in 2020/21 yielded no returns in 47% of cases – up from 31% from the previous tax year.
HMRC has invested an estimated £100m in software to support its investigations work, but the low success rate for investigations suggests the digital approach to risk assessment may not be excluding the lowest risk taxpayers.
Graham Boar, partner at the firm commented: ‘HMRC has a strong track record in collecting money from additional compliance checks, raising £13.6bn last year. But as it aims to close the tax gap, too many people are getting caught in its net. Taxpayers need reassurance that there is a valid reason for an investigation to be opened into their affairs and that time and stress isn’t wasted on cases that will yield no results.’
