Peak in tax heist as 100,000 stores neighboring HMRC
The public denounced more than 100,000 suspected cases of tax evasion last year, despite shutting down the hotline for advice for nearly five months at the start of the pandemic.
Experts credited an increased sense of moral duty to the 107,000 reports of alleged tax evasion to HM Revenue & Customs in fiscal year 2020-21. This included reports of people abusing programs such as the Self-Employed Leave and Income Support program.
The figure, obtained from an access to information request from the accounting firm UHY Hacker Young, showed a slight decrease of 3% from the 110,848 whistleblower reports received by the tax authorities during the year. tax year 2019-2020.
However, Phil Kinzett-Evans of UHY Hacker Young said the number of reports made during the pandemic was “remarkable” given that the public was unable to use the reporting services for much of the year.
HMRC shut down its hotline to report tax evasion between March and August last year as it rushed to respond to the pandemic.
The government, however, launched a dedicated 24/7 hotline in October last year to encourage taxpayers to anonymously report suspected fraudsters targeting coronavirus support programs.
Its postal service to receive denunciations is still suspended, 18 months after being closed, due to “measures put in place to stop the spread of the coronavirus”. During the four years preceding the pandemic, the tax administration received on average nearly 11,000 reports per year via its postal service.
Mr Kinzett-Evans said: “In the past, more people may have chosen to turn a blind eye to tax evasion, thinking it was none of their business.
“But in recent years, people have generally come to accept that paying taxes honestly is a responsibility everyone shares, and fewer people feel guilty for reporting those who don’t.”
In June of this year, the tax authorities had received nearly 29,000 reports from employers who allegedly misled the government’s coronavirus job maintenance program.
Speaking to MPs in September last year, Jim Harra, the head of HMRC, estimated that between 5% and 10% of leave funds were paid on fraudulent or incorrect claims. He said this could represent a bill of up to £ 3.5bn, but that estimate is likely to have risen significantly since then.
Mr Kinzett-Evans said: “Those involved in tax evasion should make a disclosure to HMRC as soon as possible and seek specialist advice in the process.
“The tax authorities will be much less sympathetic to those who deliberately hide their tax affairs and choose to be silent.”
The HMRC advises anyone reporting suspected tax evasion not to tell anyone about the report and not to pursue the case themselves.
Nimesh Shah, of accounting firm Blick Rothenberg, said there was a “core demographic” who would always report fraudulent behavior. “Accountants, for example, have an obligation to report this sort of thing to HMRC or the police.
“There will also always be a static group of citizens who will report suspicions of tax evasion day in and day out, and more than the average taxpayer. So many reports will come from the same group of people. “
Mr Shah warned that the public could be dissuaded from issuing an alert if they discover that the means to report the fraud are still out of order. “They should make reporting fraud as easy as possible,” he said. “Everyone has a role to play.