The NAO report on ‘HMRC’s approach to collecting tax from HNWs’ also revealed that the tax authority was criminally investigating 10 HNWs in relation to illegal offshore tax evasion, although only one had been prosecuted since 2010.
In relation to the so-called Panama Papers data, it specifically identified 40 high net worth individuals who are being investigated by staff in the high net worth unit and the fraud investigation service.
HMRC set up a high net worth unit to focus on HNW individuals in 2009 and has around 380 staff, with a customer relationship manager assigned to each HNW individual.
The unit raised an estimated £416m in the tax year 2015-16 from the HNWs defined as having a net worth of £20m or more.
In 2016-17 this unit extended its reach by reducing the net worth threshold to £10m or more, but the NAO report only refers to those HNWs with £20m or more.
Marketed avoidance schemes
As for ‘marketed avoidance schemes’, the report said £1.4bn of tax was at risk from around 1,000 HNWs and that HMRC was “making good progress” in tackling the use of these schemes.
It further highlighted that 137 HNWs had voluntarily told HMRC about £141m of tax liabilities through the Liechtenstein Disclosure Facility, representing 2% of all disclosures.
There were also 151 inheritance tax records under investigation relating to HNWs estates between May 2014 and April 2016.
IHT of £183m had been paid on these 161 estates to date, but the final amount was not yet known.
In an international context, the report further said one-third of countries surveyed by the OECD, including the UK, had a dedicated HNW tax unit: Argentina, Australia, Brazil, Canada, Chile, Costa Rica, France, Greece, Indonesia, Ireland, Japan, Malaysia, New Zealand, Portugal, Romania, South Africa, Spain, United States of America and the Netherlands.
