Can big business relax? HMRC probes struggle as cash yielded from investigations falls
The taxman is struggling to squeeze Britain's largest businesses as the cash yielded from its investigations fell by a quarter.
HM Revenue & Customs (HMRC) collected an extra £2.6bn from largest businesses in 2016, down from £3.5bn the year before, according to analysis of HMRC’s Large Business Directorat by law firm Pinsent Masons.
Read more: "Middle class is next" for HMRC with more tax investigators hired
Heather Self, a partner at Pinsent Masons, provided one reason for the decline in 2016:
The fall in additional revenue could be an indication of a ‘lower-risk’ approach to tax planning among large corporates over recent years.
Intense media scrutiny and high-profile clamp downs by HMRC have pushed aggressive avoidance strategies off the agenda for many large businesses.
However, Self added this did not mean big business could rest on their laurels.
"We are seeing HMRC taking a more aggressive stance in relation to commercial transactions which were once seen as routine planning. The issues tend to be less clear cut, which can make them more difficult for HMRC to tackle," she said.
Freelancer woes
Meanwhile, freelance workers are facing an uphill struggle to fill their annual self-assessment tax returns, according to separate research by the Association of Independent Professionals and the Self Employed (IPSE).
Read more: HMRC is after nearly £2bn in tax from the UK's richest
The analysis indicated contractors have an average of two days completing their tax return, and lose a working day trying to get through to HMRC – costing the UK economy an estimated £521m each year.
"Many are spending too much time trying to get through to HMRC, and are often put on hold for considerable periods. There needs to be a much better line of communication between HMRC and self-employed people," said IPSE chief exec Chris Bryce.