Sinead Moore 6 Feb 2017 12:54pm

HMRC nets extra £5bn from fraud investigations

HMRC’s fraud investigation service collected nearly £5bn in additional revenue in 2016, following a crackdown on rogue company directors, accountants and organised criminals, according to Pinsent Masons

The specialist tax fraud unit, which was set up in July 2015 amid pressure to crackdown on fraud and the underpayment of taxes, collected £2.2bn from criminal investigations and £2.7bn from civil investigations over the last 12 months.

Paul Noble, tax director at Pinsent Masons, said, “HMRC’s internal restructuring and the creation of the FIS demonstrates the government’s determination to stamp out tax fraud, especially in the aftermath of the Panama Papers scandal.”

A spokesperson for HMRC confirmed the figures adding, “These are great results ‎which reflect the hard work of the highly skilled and professional people in HMRC’s Fraud Investigation Service.”

However, Noble warned “tax fraud remains very damaging to the Treasury.”

According to Pinsent Masons an estimated £16bn was still lost through tax fraud last year, accounting for almost half of the UK’s £34bn tax gap.

HMRC’s spokesperson added, “the vast majority of UK individuals and businesses pay their taxes in full and on time, and the UK’s tax gap is one of the lowest in the world."

“In addition to the £5bn revenue raised, we are very successful at tackling organised crime and serious fraud through criminal prosecutions,” the Revenue’s spokesperson said.

“More than 90% of our serious fraud cases result in guilty verdicts, and 679 individuals were successfully convicted last year alone.”

In total HMRC brought in around £26bn in additional revenue last year.