HMRC has continued its assault on high earners in its quest to stamp out tax avoidance, leaving no stone unturned as it hunts down delinquents.
Law firm Pinsent Masons has found that the Revenue is now turning its attention towards taxpayers with rapidly rising wealth – a tactic that has netted HMRC an extra £11.5 million since 2012.
The taxman’s ‘rising stars’ unit was launched to investigate the dealings of individuals with rapidly growing incomes and a net worth of at least £15 million. It also targets those who have the potential to meet the £20 million wealth criteria that would see them come under the remit of the ‘high net worth’ (HNW) team within the next five years.
According to HMRC, the rising stars unit brought in £6.6 million of extra revenue in 2013-14 – an increase of £1.7 million compared to the previous year. The group of high net worth individuals (totalling around 6,200 taxpayers) contributes between £3 billion and £4 billion to the Revenue’s coffers each year.
Fiona Fernie, partner and head of tax investigations at Pinsent Masons, said: “HMRC has been clamping down on suspected tax avoidance among very wealthy individuals for some time and now it has a system in place to monitor those with fast-growing wealth well before they reach the necessary threshold for scrutiny by the HNW unit.
"These individuals are likely to be successful entrepreneurs and those rising quickly through the ranks at investment banks and other financial services firms. Monitoring these taxpayers from an early stage is likely to result in more efficient scrutiny as they move into a higher wealth bracket.”
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