£70m collected from multi-nationals for ‘diverting profits’

In 2022-23 HMRC collected more than £70m in extra tax from multinational businesses making voluntary disclosures through the profit diversion compliance facility according to multinational law firm Pinsent Masons.

Sam Wardleworth senior associate at Pinsent Masons said: ‘HMRC is now particularly vigilant to multinationals diverting profits abroad to reduce their UK tax bills. It is an area where HMRC is increasingly focusing its investigations. Any that have done so should consider coming forward to avoid the worst penalties.’

The profit diversion compliance facility was launched by HMRC in 2019 to encourage multinationals to review their own transfer pricing and profit diversion arrangements. They are then asked to come forward if they have underpaid tax. Its use has been gathering pace since its launch. The £70m in tax recovered through the facility in 2022-23 represented a rise of 3% on the £68m recovered in 2021-22 and...