Rise in number of foreign government requests for HMRC tax evasion assistance

HMRC received 2015 requests for help with investigations into taxpayers from foreign governments in 2016, up 24 % on the 1619 requests received in 2015, as authorities step up efforts to stop tax evasion, according to research from Pinsent Masons

The increase in the number of requests is in line with the global clampdown on suspected tax avoidance and evasion, as governments increase their efforts to ensure that large corporations and high net worth individuals pay the correct amount of tax.

The requests were made under ‘direct tax instruments’, which allow different jurisdictions to exchange information on the tax affairs of individuals and businesses operating cross-border. These include the bilateral double taxation agreement, bilateral tax information exchange agreements and OECD information sharing agreements.

Paul Noble, Tax Director at Pinsent Masons, said: ‘HMRC is working more closely than ever with overseas tax authorities as it works to stamp out suspected underpayment of tax- both corporate and personal. The high number of requests is indicative of a more hardline approach globally.

‘HNWs and multinational companies tend to have highly complex tax affairs, spanning multiple territories with widely varying systems and rules. Ensuring that tax affairs are in order across different jurisdictions is now more important than ever.’

HMRC has almost doubled its number of requests to foreign governments over a five-year period. The tax authority made 1,096 information requests to tax authorities overseas, up 7% from 1,025 in 2015.

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