HMRC compliance yield up by 23%
HMRC compliance yield up by 23%
The amount of money collected by HMRC from its compliance activities rose to £42.8bn in 23/24, a 23% rise on the previous year, according to HMRC’s annual report published today.
The figures show a rise in yield from helping people get their tax right up front and preventing problems, rather than from after-the-event compliance checks.
Indeed, there was a significant decline in the number of fraud enquiry cases opened by HMRC during the year - known as Code of Practice 8 (COP8) and Code of Practice 9 (COP9).
The number of new COP8 cases fell to 212 in 23/24, down from 674 in the previous year, while the number of new COP9 investigations from 417 to 268 during the same period.
Meanwhile the total number of COP8 cases fell from 1,121 in 22/24 to 937 in 23/24, while COP9 cases fell from 2,181 to 2,077 during the same period.
COP8 enquiries usually involve larger transactions, tax avoidance schemes or offshore transactions while COP9 enquiries usually relate to suspected deliberate inaccuracies in individuals’ and businesses’ records.
Commenting on the new figures, Dawn Register, Head of Tax Dispute Resolution at accountancy and business advisory firm BDO said:
“While HMRC will be happy to have registered a significant rise in yield from its compliance activities, the drop in new fraud enquiries seems to be at odds with fraud trends which appear to be on the rise.
“Indeed, our own FraudTrack research published earlier this year found the value of reported UK fraud doubled in 2023.
“While the new and overall numbers of fraud enquiries have declined over the last year, the average tax under consideration per case has risen from £1.6m in 22/23 to £2.2m in 23/24, suggesting that HMRC is focusing its efforts on cases where higher amounts are at stake.
“This might be a sensible strategy from the point of view of filling the Government’s coffers, but arguably there needs to be a credible deterrent to all levels of tax evasion. Plus more resources for HMRC if necessary.”
ENDS
The organisations we work with are Britain’s economic engine; entrepreneurially-spirited, high-growth businesses that fuel the economy.
We understand the ambitions and entrepreneurial mindset of those we work with and have the global reach, integrity and expertise to help people and businesses succeed.
BDO LLP
BDO LLP operates in 17 offices across the UK, employing 8,000 people offering tax, audit and assurance, and a range of advisory services. BDO LLP is the UK member firm of the BDO international network.
BDO’s global network
The BDO global network provides business advisory services in 166 countries and territories, with more than 115,000 people working out of 1,776 offices worldwide. It has revenues of US$14bn.
Email: frank.x.shepherd@bdo.co.uk
Tel: 07812 463601
The figures show a rise in yield from helping people get their tax right up front and preventing problems, rather than from after-the-event compliance checks.
Indeed, there was a significant decline in the number of fraud enquiry cases opened by HMRC during the year - known as Code of Practice 8 (COP8) and Code of Practice 9 (COP9).
The number of new COP8 cases fell to 212 in 23/24, down from 674 in the previous year, while the number of new COP9 investigations from 417 to 268 during the same period.
Meanwhile the total number of COP8 cases fell from 1,121 in 22/24 to 937 in 23/24, while COP9 cases fell from 2,181 to 2,077 during the same period.
COP8 enquiries usually involve larger transactions, tax avoidance schemes or offshore transactions while COP9 enquiries usually relate to suspected deliberate inaccuracies in individuals’ and businesses’ records.
Commenting on the new figures, Dawn Register, Head of Tax Dispute Resolution at accountancy and business advisory firm BDO said:
“While HMRC will be happy to have registered a significant rise in yield from its compliance activities, the drop in new fraud enquiries seems to be at odds with fraud trends which appear to be on the rise.
“Indeed, our own FraudTrack research published earlier this year found the value of reported UK fraud doubled in 2023.
“While the new and overall numbers of fraud enquiries have declined over the last year, the average tax under consideration per case has risen from £1.6m in 22/23 to £2.2m in 23/24, suggesting that HMRC is focusing its efforts on cases where higher amounts are at stake.
“This might be a sensible strategy from the point of view of filling the Government’s coffers, but arguably there needs to be a credible deterrent to all levels of tax evasion. Plus more resources for HMRC if necessary.”
ENDS
Note to editors
Accountancy and business advisory firm BDO LLP provides integrated advice and solutions to help businesses navigate a changing world.The organisations we work with are Britain’s economic engine; entrepreneurially-spirited, high-growth businesses that fuel the economy.
We understand the ambitions and entrepreneurial mindset of those we work with and have the global reach, integrity and expertise to help people and businesses succeed.
BDO LLP
BDO LLP operates in 17 offices across the UK, employing 8,000 people offering tax, audit and assurance, and a range of advisory services. BDO LLP is the UK member firm of the BDO international network.
BDO’s global network
The BDO global network provides business advisory services in 166 countries and territories, with more than 115,000 people working out of 1,776 offices worldwide. It has revenues of US$14bn.
Contacts
Frank ShepherdEmail: frank.x.shepherd@bdo.co.uk
Tel: 07812 463601