HMRC Tax enquiries

Ever wondered how HMRC gather information to check that a tax return is accurate?

Part of their information comes from a specialist program called Connect that links 28 data sources including Companies House, the Land Registry, the Benefits Agency, both UK and offshore banks and so on. HMRC will also purchase data from other sources to add to their knowledge, for example they have recently launched “Credit Card Sales Campaign” to identify undeclared income. Information on credit card sales is pretty difficult to hide given that it is collected by the credit card companies themselves. HMRC can check such sales to the card company records and so it would be a foolish person who did not declare this income.

Taxpayers should note that the program produces a link from taxpayers to addresses, companies, partnerships, trusts and investments and can work across all taxes. The program cost HMRC £80m but has already generated £3bn of tax.

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