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Closing the Gap: MS Taxes Tells You What HMRC Has Been Doing Recently 

VAT Fraud Investigation

Closing the Gap: MS Taxes Tells You What HMRC Has Been Doing Recently 


In recent years, the UK's tax landscape has witnessed a significant shift with an increased focus on tax compliance measures. This case study explores the outcomes of these efforts, revealing a noteworthy £11.4 billion in unpaid tax recovered by HMRC. The surge in investigations, particularly targeting wealthy individuals and mid-size businesses, highlights a concerted effort to bridge the tax gap and ensure a fair contribution to public finances.


During the financial year 2022/23, HMRC intensified its pursuit of tax evaders, opening 23% more inquiries into unpaid VAT. The total number of investigations reached 109,400, a substantial increase from the previous year's figure of 88,700. This comprehensive approach encompassed individuals, small businesses, and large corporations.

Key Findings:

  1. Wealthy Individuals and Mid-Size Businesses:

Investigations into wealthy individuals and mid-size businesses surged by 22%, emphasizing a strategic targeting of high-net-worth individuals and businesses with substantial financial activities.


  1. Large Businesses:

Cases opened into large businesses increased by 17%, indicating a focused effort to scrutinize the financial practices of major corporations.


  1. VAT Compliance Investigations:

The most significant boost in recovered funds, £5 billion, resulted from VAT compliance investigations targeting large businesses. This underscores the effectiveness of targeting this sector to close the tax gap.


  1. Tax Gap Increase:

Despite the successful recovery efforts, the tax gap between HMRC estimates and actual collections widened to £8.8 billion in the 2022/23 tax year, up from £7.6 billion in the previous fiscal year. This suggests an ongoing challenge in fully closing the gap.


The case study provides a detailed overview of the impact of heightened tax compliance measures, showcasing substantial gains in recovering unpaid taxes. While the focus on wealthy individuals, mid-size businesses, and large corporations has proven effective in recouping funds, the widening tax gap highlights the need for continued efforts and innovative strategies to ensure sustained progress in closing the divide between estimated and collected taxes. This case study serves as a valuable reference for policymakers, tax professionals, and businesses alike, emphasizing the importance of proactive compliance measures in maintaining a robust and equitable tax system.

Most HMRC enquiries are based on evidence that HMRC has uncovered from various sources. But it is important to go through the enquiry with a fine-tooth comb or HMRC will try and get more than they are owed. We have different levels of services:

  1. Have an initial meeting with us, we will tell you your options and how we would fight your case. Then you decide to go it alone, this may be the best decision if you don’t have any assets to protect but always best to get some advice or it could turn to Cop-8 which is criminal.
  2. If you have assets to protect and a viable business you need to instruct MS Taxes or another adviser to fight your case. This removes the HMRC headache and gives it to us. We also argue your case and get you the best result! And do everything in between.

If you have a HMRC letter do not hesitate to contact us now.

Contact Our Team

Get in touch with us for confidential and no-obligation tax advice.

Call us on:
0333 577 6909

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What to expect from our team...

  • HMRCPenalty Appeals & Tax Hearings

  • HMRC Tax Investigations

  • VAT Specialist Advice & Investigation

  • Contractual Disclosures

  • Offshore Disclosures

  • Voluntary Disclosures

Here to help, not to judge
Tax Specialist


Partner Nicola has a wealth of experience in dealing with all types of Indirect Tax Investigations (VAT).
Nicola has been VAT Inspector for over 20 years at HM Customs now HM Revenue & Customs. She was a Higher Officer for more than 10 years.
Her duties included carrying out vat inspections of all types and size of businesses dealing with technical issues to detecting evasion. Nicola recently joined MS Taxes as head of Indirect Tax Investigation.

Contact Tofail Rahman on:

Tax Investigation Specialist
Tofail,Founding Partner and Tax Investigation Specialist


Founding Partner

Tofail is a qualified Chartered Accountant with over 15 years of experience in accountancy and taxation.
He has worked alongside a former Inspector of Taxes gaining invaluable insights of inner HMRC workings, which he utilises to support clients through tax challenges and steer clear from possible investigations.
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Tax Specialist
Tim,Founding Partner


Founding Partner

Tim has a wealth of experience dealing with all types of International Payroll Tax and IR35 Tax Investigations.
Tim has worked within Financial Services and Accounting since 2001 including working with HMRC on VAT investigations.
He is a specialist in International Taxation Experience, International PEO Employment Solutions as well as in providing solutions for contractors and limited companies.

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Worldwide Disclosure Expert



Andrew began his career in HM Customs & Excise and subsequently moved to HMRC (then called the Inland Revenue) on appointment as one of HM Inspector of Taxes.
completing his training he was sent as District Inspector in charge of West Midlands and was soon transferred to Head Office as a fraud investigator in Enquiry Branch (now Fraud Investigation Services) where he spent eight years conducting Code of Practice 9 investigations on a wide variety of individuals, partnerships and companies.

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