HMRC tax enquiries jumped by over 20 per cent last year in the space of just two years with 2999,000 enquiries last year

The UK’s 4.3m self-employed employees have been suggested to prioritise their tax compliance after official HMRC knowledge exhibits that the tax authority opened 299,000 tax enquiries final yr – a 52,000 bounce equal to 21% in comparison with two years earlier than.

The statistics, gathered from HMRC’s quarterly efficiency updates, present that the variety of tax enquiries (known as ‘civil compliance checks’) opened by HMRC rose from 247,000 within the 2020/21 monetary yr, to 265,000 in 2021/22 and 299,000 in 2022/23. In complete, this marks a 21.05% enhance throughout these years.

The numerous enhance in compliance exercise noticed the tax workplace web £814bn in tax income in 2022/23 – an 11.3% bounce in comparison with the earlier yr.

Within the first quarter of the 2023/24 monetary yr (April to June 2023), the tax workplace has already opened 77,000 enquiries, which means HMRC is heading in the right direction to extend this for the third yr working (308,000).

In consequence, tax insurance coverage supplier, Qdos, has urged thousands and thousands of self-employed employees and the rising variety of folks with aspect hustles to pay attention to HMRC ramping up its compliance exercise.

Qdos CEO, Seb Maley, commented: “HMRC is clearly on a mission to extend tax receipts and we’re seeing first-hand expertise of this. The variety of self-employed employees being investigated by the tax workplace is noticeably on the rise.

“A much more energetic HMRC implies that anybody working for themselves – whether or not a full-time freelancer or somebody with a aspect hustle – ought to ensure that they file their tax returns and pay their payments on time, because the naked minimal.

“However that is simply a place to begin. What’s typically neglected is that HMRC can examine anybody at any time. You may by no means rule out a tax enquiry and all too typically, individuals who have finished nothing unsuitable are investigated. With out illustration and safety, this generally is a actually nerve-racking and costly course of.”