Implementing enhanced tax compliance measures has resulted in the recovery of £11.4 billion in unpaid taxes, as investigations targeting affluent individuals and medium-sized enterprises expanded.
According to a freedom of information request from Thomson Reuters, HM Revenue and Customs (HMRC) increased the number of inquiries into unpaid value-added tax (VAT) by 23%, resulting in a total of 109,400 investigations in the past financial year, compared to 88,700 the previous year.
The most significant increase in examination focused on affluent individuals and medium-sized enterprises. At the same time, the highest amount of revenue was generated through intensified investigations into value-added tax (VAT) issues affecting significant corporations.
The division responsible for investigating these businesses experienced a 60% increase in the number of investigations, rising from 3,253 in the financial year ending on March 31, 2022, to 5,203 in the year ending on March 31, 2023.
However, there were increases in all three sections to ensure compliance with VAT regulations.
The number of investigations initiated against people and small firms increased by 22%, while the number of investigations against major businesses grew by 17%.
Last year, the central enterprises division had a significant surge in revenue, generating an additional £5bn due to VAT compliance inspections.
The Value Added Tax (VAT) constitutes around 20% of the overall tax collection, positioning it as one of the primary sources of income for the government, alongside national insurance and income tax.
HMRC received more resources to enhance its efforts to recover higher tax revenues.
Over 3,000 employees have been recruited to the customer compliance units of HMRC since the start of the 2021-2022 fiscal year.
However, the disparity between the amount of VAT that HMRC projected to be owed and the actual amount it collected was more significant in the previous year compared to the year prior.
In the 2022-2023 tax year, the deficit amounted to £8.8bn, an increase from £7.6bn in 2021-2022, contradicting the prior pattern of decline.
댓글