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HMRC working with overseas counterparts to analyse 400gb of info
Hundreds of taxpayers and their advisers face scrutiny by HMRC after the department confirmed it is working with its counterparts in the USA and Australia on data that reveals widespread tax evasion.
The three tax authorities are studying 400 gigabytes of information that was leaked to the Revenue by an unnamed source. It is said to show extensive use by wealthy individuals and businesses of complex offshore structures to illegally conceal assets.
The data – the largest single tranche to have been received by the UK tax authorities – was delivered in an “unstructured and broken” format, according to HMRC. It is understood that the US Internal Revenue Service and the Australian Tax Office were also handed similar digital records.
Early analysis has exposed the exploitation of companies and trusts in a number of territories around the world, including Singapore, the British Virgin Islands, the Cayman Islands, and the Cook Islands. The Revenue has so far identified more than 100 individuals in the UK who benefit from evasion structures and over 200 accountants, lawyers and tax advisers who give counsel on the arrangements.
“This data is another weapon in HMRC’s arsenal,” said the chancellor, George Osborne. “The prime minister has made it a key priority to drive an international effort to increase transparency and clamp down on tax avoidance and evasion. By working with our international partners in this way, we are again demonstrating our commitment to this work.”
Tax investigations expert John Cassidy claimed the Revenue has greatly improved over the “past year or so” at analysing data, both alone and in conjunction with other tax authorities, and has become better skilled in converting intelligence into targeted investigation cases.
The source of the latest information “is largely irrelevant”, added Cassidy, a partner at Crowe Clark Whitehill accountants. “The fact is, it is in the hands of HMRC and will be made use of.”
Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants, said, “Global collaboration by tax authorities in different markets is a welcome move and one we expect to see more of in future.
He continued: “We should never lose sight of the fact it is a small number of people who are evading tax and the majority of accountants, lawyers and other professional advisers, as well as their clients, are not breaking any laws.”
