HMRC Increases 'Aspect' Enquiries

by Amanda Banks, Tax-News.com, London

23 August 2010

A significant increase in personal tax 'aspect' enquiries confirms that HM Revenue and Customs (HMRC) is adopting a more targeted approach, according to insurance provider Abbey Tax Protection.

Over 28% of claims noted during July 2010 were after personal tax 'aspect' enquiries, an 82% increase on the number of personal 'aspect' enquiry claims made during July the previous year. The rise has been interpreted by experts as evidence of HMRC focusing its investigations on high-net-worth individuals.

'Aspect' inquiries are narrower than full investigations into an individual’s entire tax return, concentrating on entrepreneur’s relief, capital gains tax, investment income and tax planning. As such they are less costly to perform, highlighting HMRC’s attempt to become more cost-efficient in the face of spending cuts and staff reductions.

July 2010 also saw a 22% increase in the total number of claims on last year’s tally, reflecting an increase in enquiry activity as a result of a more focused investigative practice.

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