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Eight Percent Increase In Serious UK Tax Evasion Cases

by Robert Lee,, London

13 June 2016

There was an eight percent increase in the number of serious UK tax evasion cases identified by HM Revenue and Customs (HMRC) in 2015-16, according to research by international law firm Pinsent Masons.

Pinsent Masons said that 2,972 cases were flagged by local HMRC offices and passed on to the Evasion Referral Team in 2015-16, compared with 2,749 in 2014-15. It added that HMRC is under political pressure to crack down on aggressive tax avoidance and evasion, and pointed out that at the 2015 Budget the Department was granted an extra GBP800m (USD1.1bn) to invest in its compliance activities. It is expected that the number of criminal prosecutions into serious and complex tax crime will triple over the next five years.

Fiona Fernie, Partner at Pinsent Mason, said: "HMRC is very alive to the ongoing need to tackle serious onshore and offshore tax evasion. Although significant progress has been made to deter offshore tax evasion in recent years, the battle is far from over."

"Headline-hitting exposés like the Panama Papers leak and the HSBC Swiss banking scandal highlight that sheltering wealth from the taxman, remains an extremely highly charged issue. This is exacerbated by the apparent blurring of the lines between avoidance and evasion and the fact that many individuals seem to assume that any type of tax structuring which involves offshore is automatically illegal."

She added: "HMRC now has more weapons in its arsenal to help it hit increasingly exacting enforcement targets. There is no question that it is prepared to use them to powerful effect to clamp down on wrongdoing and maximize the deterrent value."

"HMRC is using increasingly sophisticated tools and techniques to uncover wrongdoing – from closer liaison with overseas tax authorities, to cutting edge data analytics which can flag up anomalies or trends within the information that HMRC and other government agencies hold. This should result in continuous improvements in HMRC's success rate both in identifying suspected crime and prosecuting those cases successfully."

TAGS: individuals | compliance | tax | business | tax compliance | tax avoidance | law | banking | budget | United Kingdom | enforcement | tax authority | offshore | HM Revenue and Customs (HMRC) | HM Revenue and Customs (HMRC) | Panama | Tax | Tax Evasion

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