The recent figure, which comes from analysis by law firm Pinsent Masons, is up £1.2bn from 2020 after HMRC had to suspend some of its investigation work for part of 2020 as it focused on the administration of the Covid-19 support schemes.
In the past year, HMRC has collected £5.8bn in cash from its tax investigations activity and prevented a further £11.2bn in revenue from being lost.
Income from investigations into the 2,000 biggest businesses in the year to 31 March 2021 brought in £8.6bn which also accounted for 28% of all HMRC’s tax investigations yield last year.
The tax authority has also benefitted from an extra £6.4bn from closing tax loopholes, one example of this was the closing of the loophole which allowed owners of second homes to avoid tax by claiming their often-empty properties are holiday lets.
An area of key focus for the tax authority is underpaid tax by big businesses, with HMRC disclosing that £35.8bn worth of tax is currently classed as ‘tax under consideration’ which is the amount tax liability within an investigation before HMRC has completed it.
The analysis found that HMRC’s large business directorate, the team responsible for investigating the tax affairs of the UK’s biggest and most complex businesses, had a recent staff bill of £125m generating a 6,800% return on investment on the £8.6bn it brought in.
Steven Porter, partner, Pinsent Masons, said: ‘HMRC undertakes a huge programme of compliance activity every year. This ranges from property raids to social media monitoring to closing tax loopholes. In the past year HMRC has ramped up its activity even further as the lenience it showed during the pandemic comes to an end.
‘This goes for large corporates as well as smaller businesses and individuals. HMRC’s stance on corporates underpaying tax has hardened significantly in recent years and is only likely to get tougher as it uses international data, big data and artificial intelligence to help it pursue unpaid tax.
‘HMRC has been investing in its compliance work significantly and is generating great returns as a result. This should act as a reminder to individuals and businesses that HMRC will not let up on its pursuit of recovering unpaid tax.’
