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HMRC have denied that they are being forced to hire expensive law firms to help deal with a backlog of litigation against suspected tax evaders.
The department's claim came as a rebuttal to a story in The Sunday Times, which claimed that the Revenue Solicitor's Office is attempting to clear 1,000 cases by contracting out work to private legal practices, 'whose partners charge up to £1,000 an hour'.
The newspaper went on to report that HMRC have 'already hired Lovells to act for it in a cross-border tax case later this year'.
'There is no backlog with [our] litigation,' said HMRC. 'We have a very large litigation practice, and we do almost all of it in ourselves.
'As a responsible organisation, we have for many years made use of the private sector to handle some of our smaller cases for us.
'We are currently experimenting with one of our middle-sized cases by asking a City firm to handle it for us.'
Regardless of the veracity of the Times' article, tax professionals have expressed little surprise at the possibility of the Revenue employing outside help given anecdotal evidence that its investigations team is being stretched to capacity.
PKF partner John Cassidy remarked that the taxman is widely known to have made use in the past of such contractors as solicitors, liquidators and forensic accountants.
'If the department is over-burdened — and I believe that it is — it makes sense to get help,' he said.
'And if the Revenue really does have more cases than it can handle, investing in outside legal resources is justified, as long as it is properly managed.
'However, litigation should be the last resort. There are many other doors of opportunity to settle such matters and reach a negotiated settlement.'
Craig Tully of award-winning tax investigators Gilbert Tax commented: 'It should come as no surprise that HMRC are seeking to use outside resources to fill their skills gap in an endeavour to fill the public purse.
He added: 'It may be that the use of specialist firms to expedite certain cases proves to be value for money for the taxpaying public.
'But I hope that it is not at the expense of the position of the Revenue Solicitor's Office, which on many occasions has seen sense and prevented costly and unnecessary litigation.'
