HMRC have provided an update on the costs of tax evasion and the hidden economy to the British taxpayer.
Tax evasion and the hidden economy costs the taxpayer £9 billion every year. A new crackdown on tax evasion launched today will make information on all credit and debit card payments to UK businesses available to HMRC for the first time.
Under new powers which came into effect on 1 September, HMRC can now access information from the UK's merchant acquirers (the companies that process credit and debit card payment transactions) to find out the number and value of transactions completed by a specific trader. No personal data identifying the card owners or card numbers will be obtained, but this data will be used to ensure that traders have correctly accounted for all taxes due thereby levelling the playing field for all businesses.
We estimate that the information collected could help us to reduce tax evasion by more than £50 million per annum.
This week also sees the launch of our tax evasion advertising campaign, which works alongside existing compliance activity such as the information collected from merchant acquirers, to raise awareness among those breaking the rules that HMRC is closing in on undeclared income.