HMRC wins 83% of court cases in 2016/17

HMRC’s latest accounts show the tax authority had an 83% success rate in taking actions through courts and tax tribunals protecting £15bn in tax and has brought in record tax revenues for the seventh consecutive year of £574.9bn

HMRC’s 293-page annual report for 2016-17 shows that the tax authority had 1,200 tax cases heard in courts of which it won 83%. In 2015-16 1,041 cases were heard in the First Tier Tribunal (FTT) of which HMRC won 782 compared to 2016-17 where 1,130 cases were taken to the FTT and 867 were successful.

A total of 886 fraudsters were prosecuted in 2016 to 2017, mostly for tax related offences, serving a collective total of 806 years in prison.

In 2016-17 HMRC made repayments of £1.8bn with respect to legal provisions. As at 31 March 2017 HMRC expects to have to repay £7.8bn (2015-16: £5.9bn).

Outcome of appeals heard:

 

2015-16 FTT

2016-17 FTT

Upper Tribunal

High Court

Court of Appeal

Supreme Court

Total

1,041

1,130

78

15

28

4

HMRC win

782

867

62

10

19

2

Partial win

72

79

3

1

3

0

Taxpayer win

187

184

13

4

6

2

Success rate

82.04%

83.70%

83.33%

73.33%

78.57%

50%

Tax revenue

HMRC brought in record total tax revenues for the seventh consecutive year of £574.9bn. This is up £38.1bn (7.1%) from 2015-16. The tax authority also generated £28.9bn of compliance yield.

Income tax collected by HMRC contributed to 30% of total revenue, and National Insurance Contributions (NICs), which was 21% of total revenues, increased 5.3% due to increases in employment levels, higher wages and changes to the way NICs are calculated for state pensions.

In 2016-17 £173.8bn was collected in income tax compared to £169.4bn the previous year.

VAT (22% of total revenue) increased 7.2% and corporation tax (9% of total revenue) increased 12.3% due to rising company profits.

Customer service

Last year HMRC received around 50 million telephone calls and 12 million letters from taxpayers. The tax authority received 77,279 new complaints in 2016-17 – a reduction of 4% compared to the previous year. It fully or partially upheld 49.4% of these complaints and resolved 98.6% of them.

HMRC handled 91.7% of customer calls against a target of 85%. The average speed of answering calls was three minutes 54 seconds against the target of under six minutes. It also turned around 81% of post with 15 working days.

Edward Troup, executive chair and permanent secretary, HMRC, said: ‘Our ability to collect the money required to fund the UK’s public services is, of course, the ultimate yardstick by which we will be measured, but the public rightly judge us on the quality of service we provide to the overwhelming majority of people in the UK who are honest and pay the right amount of tax on time.

‘Our continued focus on giving our customers the service level they deserve is paying dividends. There are now quick and simple online tools to allow people to deal with their taxes or tax credits anywhere, anytime and the best phone service in years for those wanting to call us.’

HMRC Annual report and Accounts 2016-17 is available here

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