HMRC’s specialist high net worth individuals (HNWI) unit collected £416m in 2015/16, over and above amounts declared voluntarily by this group of taxpayers, according to a new report by the National Audit Office (NAO). This has increased from £200m in 2011/12 and exceeds HMRC’s target for 2015/16 of £250m.
The report reveals that HMRC is currently conducting enquiries into the affairs of around a third of HNWIs, defined as those with a net worth of at least £10m (£20m before 2016), with an average of four issues being examined per taxpayer. These investigations have a potential value of £1.9bn (an initial estimate of the tax that could be due, covering more than one tax year). As at October 2016, HMRC has ten current criminal investigations involving HNWIs.
The NAO acknowledges that identifying HNWIs is not always straightforward, owing to the complex nature of their tax affairs. At the start of 2015/16, HMRC estimated the number of HNWIs to be around 6,500. A review during that year identified an extra 1,000 people with net worth of more than £20m.
The report notes that HMRC has gained a better understanding of this group of taxpayers since 2009, when the HNWI unit was established. However, the NAO recommends that: ‘While the yields from HMRC’s work in this area have increased, it needs to evaluate what approaches are the most effective and to understand the outcomes it achieves.’
The full report, HMRC’s approach to collecting tax from high net worth individuals, can be found here.
HMRC’s specialist high net worth individuals (HNWI) unit collected £416m in 2015/16, over and above amounts declared voluntarily by this group of taxpayers, according to a new report by the National Audit Office (NAO). This has increased from £200m in 2011/12 and exceeds HMRC’s target for 2015/16 of £250m.
The report reveals that HMRC is currently conducting enquiries into the affairs of around a third of HNWIs, defined as those with a net worth of at least £10m (£20m before 2016), with an average of four issues being examined per taxpayer. These investigations have a potential value of £1.9bn (an initial estimate of the tax that could be due, covering more than one tax year). As at October 2016, HMRC has ten current criminal investigations involving HNWIs.
The NAO acknowledges that identifying HNWIs is not always straightforward, owing to the complex nature of their tax affairs. At the start of 2015/16, HMRC estimated the number of HNWIs to be around 6,500. A review during that year identified an extra 1,000 people with net worth of more than £20m.
The report notes that HMRC has gained a better understanding of this group of taxpayers since 2009, when the HNWI unit was established. However, the NAO recommends that: ‘While the yields from HMRC’s work in this area have increased, it needs to evaluate what approaches are the most effective and to understand the outcomes it achieves.’
The full report, HMRC’s approach to collecting tax from high net worth individuals, can be found here.
