HMRC campaigns update: Latest revenue results

    The data may have taken the best part of seven months to extract from HMRC, but the wait was worthwhile as the latest revenue results from campaigns are an interesting read.  

    Campaigns involve a window of opportunity for the targeted business sector to voluntarily disclose and pay tax on undeclared income and/or overstated expenditure to HMRC, in return for a reduced penalty. Once the window has closed, HMRC embarks upon follow up compliance activity, which typically includes investigations and prosecutions.

    According to the data released by HMRC, over £1.2bn has been generated from the 18 campaigns launched to date. Only three remain live which are the Let Property, Second Income and Credit Card Sales campaigns.

    Arguably of more interest is the amount of money HMRC is continuing to collect from the subsequent compliance action. For example, between February 2015 and March 2017, HMRC delivered nearly £25m from the ongoing pursuit of doctors and dentists in the aftermath of the Tax Health Plan campaign, even though the disclosure opportunity closed all the way back in June 2010.

    During the same time frame nearly £18m was extracted from online traders, even though the E-marketplaces campaign closed in September 2012.

    Top 5

    Here are the top 5 revenue generating closed campaigns:

    1. Tax Health Plan (doctors and dentists) - £24.7m
    2. E-marketplaces (online traders) - £17.7m
    3. Property Sales (UK and foreign residential disposals) - £14.6m
    4. Offshore New Disclosure Opportunity (UK based individuals/businesses with an offshore account/asset) - £10.8m
    5. VAT Outstanding Returns (window for VAT registered businesses to get uptodate with late VAT returns) - £8.0m

    These figures cover the period between 1 February 2015 and 31 March 2017.

    Let Property

    The money being delivered by the Let Property Campaign also appears to be gathering momentum with £135.2m accumulated by 31 March 2017.

    Launched in September 2013, the campaign initially delivered just over £0.5m on average per month, but that average has gradually climbed and is now close to £5m a month based on this latest data.
     
    Date Amount collected (£m) Increase (£m) Average per month (£m)
    Launch - 30 October 2014 7.8 N/A 0.60
    31 January 2015 20.0 12.2 4.06
    30 June 2016 92.0 72.0 4.23
    31 Mach 2017 135.2 43.2 4.80
    Source: HMRC

    Complete picture

    Once a campaign window has closed, it must be tempting for that particular business sector to breathe a sigh of relief and to assume HMRC has moved on to different targets. There is an element of truth in that presumption, however there is also a false complacency in assuming HMRC has moved on completely.

    As the figures show below, the follow up compliance action continues for a long time, with HMRC still highly active with some campaigns eight years after the disclosure window has closed.

    Here is the complete table setting out the latest results:
    Campaign Launched Closure date/Live 31/1/15 (£) 31/3/17 (£) Increase (£)
    Offshore Disclosure Facility 2007 November 2007 512,190,000 512,455,397 265,397
    Offshore New Disclosure Facility 2009 March 2010 156,923,070 167,759,651 10,836,581
    Tax Health Plan 2010 June 2010 70,961,034 95,661,578 24,700,544
    Plumbers Tax Safe Plan 2011 August 2011 22,166,777 23,877,100 1,710,323
    Tax Catch Up Plan 2011 March 2012 2,968,808 3,785,832 817,024
    VAT Initiative 2011 December 2011 22,271,526 22,711,137 439,611
    E-marketplaces 2012 September 2012 9,379,361 27,175,038 17,795,677
    Electricians Tax Safe Plan 2012 August 2012 15,803,609 16,633,824 830,215
    Tax Returns Initiative 2012 October 2012 86,279,162 86,412,021 132,859
    Direct Selling 2012 February 2013 505,617 757,568 251,951
    Let Property 2013 Live 20,017,365 135,243,635 115,226,270
    My Tax Return Catch Up 2013 October 2013 33,137,621 39,795,869 6,658,248
    VAT Outstanding Returns 2013 February 2013 38,696,945 46,719,118 8,022,173
    Property Sales 2013 September 2013 8,245,782 22,869,794 14,624,012
    Health Wellbeing Tax Plan 2013 April 2014 936,315 3,031,057 2,094,742
    Second Income 2014 Live 0 4,882,373 4,882,373
    Solicitors Tax Campaign 2014 June 2015 0 1,337,482 1,337,482
    Credit Card Sales 2014 Live 0 398,386 398,386
    Campaign Consequential Disclosures     5,536,921 20,455,297 14,918,376
    Totals     1,006,019,913 1,231,962,157 225,942,244
    Source: HMRC

    If you would like to discuss the content of this article in greater detail, please contact the author of this article, Guy Smith, our Head of Technical Research.