HMRC increases premises raids on suspected tax evaders

HM Revenue & Customs (HMRC) is advancing its moves against tax evaders by ramping up the number of property raids as part of criminal investigations.

The tax authority searched 761 properties in the last 12 months, up 28% on the previous year when it conducted 593 raids, according to Pinsent Masons.

It’s also a 53% increase on five years ago, demonstrating HMRC’s long-term plan to pursue successful prosecutions for tax evasion and the increased resources the department has been granted will only serve to help HMRC gather vital evidence as part of the criminal prosecution process.

HMRC now has the authority to raid premises and seize vital evidence it can use to secure criminal prosecutions for tax evasion using a search warrant granted by a judge or magistrate. The search warrant also enables HMRC to search individuals present at the property, including personal documentation, emails and other electronic files, which can be taken off premises for investigation.

Last year, a new multi-jurisdictional agreement as signed by more than 50 countries, agreeing to exchange tax data from next year. This agreement will likely enable HMRC to gather further information on taxpayers the authority suspects of wrongdoing.

Paul Noble, tax director, Pinsent Masons, said: “Criminal prosecutions for tax evasion can be notoriously difficult to bring to court, so raiding property is a vital way for HMRC to get hold of the crucial evidence it needs.

“Tax evasion investigations can be complex and time-consuming to uncover what are often well-hidden tracks.

“Often the only way to do this is by getting access to personal documents, files or correspondence through searches of a suspect’s homes or business premises.

“HMRC is taking greater advantage of these powers as a shock and awe tactic. By raiding premises, it not only hopes to be able to seize the proof it needs to build its case, it’s also a clear show of strength and intent which should act as a deterrent to others.”

Date published 30 Sep 2016 | Last updated 30 Sep 2016