The Affluent Unit, which investigates those with annual incomes of over £150,000 or wealth of more than £1m, netted £137.2m in extra tax in 2013/14, up from £85.7m compared to the previous year.
The international law firm said that HM Revenue and Customs (HMRC) needs to ensure the crackdown on tax avoidance does not harm the economy.
Established in 2011 by HMRC, the Affluent Unit doubled in size in 2013, recruiting an additional 100 inspectors.
Its remit also expanded to cover those with private wealth of more than £1m, down from the previous threshold of £2.5m. This makes up around 500,000 UK residents.
“This surge in extra revenue from Affluent Unit tax investigations serves as a reminder that HMRC is widening its lines of inquiry,” said head of litigation and compliance at Pinsent Masons, James Bullock.
“It is no longer focusing solely on the super-rich. People who would just consider themselves moderately successful professionals and business people are now also coming under the scrutiny of HMRC’s specialist units.”
Last year the Revenue was given new powers to recover unpaid tax from suspected tax avoiders, this includes the issuing of accelerated payment notices, which were given Royal Assent in July.
“Potentially damaging effects”
A new £45m database system, Connect, which draws information from draws from various sources such as banks, local councils and social media, has made HMRC’s ability to investigate tax avoidance easier.
The London-headquartered law firm said that, while the money raised through compliance should be welcomed, HMRC needs to carefully weigh up the benefits of increased investigations against potentially damaging effects on the economy.
“Investigations create uncertainty, and if wealth creators are tied up in enquiries or if their tax affairs are being investigated for a number of years then they have to keep money tied up in case they end up with a big tax bill,” said Bullock.
He added: “The apparent disappearance of the proposed strict liability offence of offshore tax evasion are hopeful signs that HMRC is getting the message on this front.”
