And as a result it is focusing less on those with a higher net worth.
Sean Wakeman, tax investigations partner at Crowe Clark Whitehall, said the firm has begun seeing considerable interest from HM Revenue and Customs (HMRC) on individuals in this bracket.
“Generally speaking, ultra high net worth individuals are able to buy advice more easily. It is therefore not surprising that we are seeing HMRC Inspectors lowering their sights somewhat having spent five years unprofitably pursuing these individuals,” he said.
HMRC has stepped up its effort to counter abusive tax avoidance and evasion in recent years and has said it was committed to “relentlessly pursue those who do not comply”.
Wakeman said in the government’s Summer Budget last month, chancellor George Osborne referred to a tripling the number of criminal investigations to 100 per year by the end of the current parliament (in 2020) and said the targets would be wealthy individuals and corporates.
“Such indiscriminate positioning of criminal culpability is both naïve and misjudged. In my experience, it is not possible to compartmentalise tax evaders so easily. They come from every social strata and wealth background,” Wakeman said.
“The only positive note here is that HMRC will also extend its use of dedicated Customer Relationship Managers (CRMs) to individuals in the £10m-£20m ($15.6m-$31.2m) wealth bracket.
”Any move by HMRC to engage with taxpayers and their agents is to be welcomed. Our experience of CRMs is very good. This will hopefully result in better communications and early closures of investigations,” he said.
