Taxman steps up war on dodgers with more raids

 

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Property searches by HM Revenue & Customs rose by nearly a fifth last year as the Government raised the pressure to combat tax evasion.

Investigators made 593 raids in the year to 31 March, up from 500 the previous year. It follows the Government in 2010 allocating £900m over four years to tackle non-compliance and HMRC got 320 more staff.

Search warrants are issued to HMRC by a magistrate or judge. They permit officers to search individuals on a property as well as seize documents and electronic files. They are often conducted early in the morning or over holiday periods. The evidence obtained can be crucial for criminal convictions.

According to the law firm Pinsent Masons, the number of raids trebled in the last four years. In the 2010/11 tax year, just 196 were conducted.

The surge in raids reflects the pressure being placed on HMRC to increase the number of criminal prosecutions for tax evasion. In 2013, the Government set it a target to secure 1,165 in 2014/15, up from the 165 obtained in 2010/11, Pinsent Masons said.

The number of tax evaders given a custodial sentence has risen by around 30 per cent over the last four years, from 171 in 2011 to 220 last year.

Paul Noble, tax director at Pinsent Masons, said raids are labour-intensive but needed in certain investigations. “A non-criminal tax inquiry is much more cost-effective but does not always send the deterrent message HMRC wish to convey.”

He added: “An increase in the number of raids conducted and custodial sentences meted out reflect the fact that HMRC is casting its net wider. It is no longer focusing narrowly on HNWIs [high-net-worth individuals] and those guilty of the most serious evasion. It is targeting a broad range of taxpayers and refusing to let those suspected of more minor offences slip through the cracks.”

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