HMRC To Ask The Rich What They Think About Paying Tax

HMRC is spending £80,000 trying to find out how Britain’s wealthiest taxpayers feel about tax compliance.

Researchers want to speak to these rich taxpayers but feels few will want to help the inquiry.

The target for the report is anyone earning more than £20 million a year as their tax affairs are handled by personal managers at a special HMRC unit.

But as a third of these wealthy individuals are under tax investigation at any one time, says HMRC, hopes of their co-operation are slim at best.

Last year, the inquiries within this group involved almost £2 billion of potentially unpaid tax.

Hard to reach group

And since HMRC has offered the wealthy a personal tax manager, the amount of tax they pay each year has dropped by £1 billion. This suggests the wealthy overpay instead of under pay the tax they owe.

“This is an increasingly important area of work for the department, and an opportunity to conduct innovative research that will feed into the development of new policies,” said an HMRC spokesman.

“We recognise that this group may be challenging to engage in compliance research but at the same time the project offers plenty of opportunities for trying new approaches; in addition, we have managed to successfully carry out research with other hard to reach populations in the past, and we could provide a sample of the wealthy population as a sampling frame.

Looking for honest and meaningful response

“This is social research to help with our understanding of the underlying attitudes and behaviours driving tax compliance by wealthy Individuals. The UK has one of the lowest levels of unpaid tax in the world and we have secured more than the annual NHS Budget in additional compliance revenues since 2010.”

HMRC is asking for research firms to tender for the work.

The project will involve two phases. The first will be a pilot, followed by a review and then the main research stage.

The pilot will look at ideas to improve tax compliance within the wealthyand attempt to ‘elicit honest and meaningful responses from the participants’.

As a Plan B, HMRC expects to researchers to talk to tax agents rather than their wealthy clients.