HMRC have been handed what sounds like a premier league transfer budget to improve their squad.

Following the Spring Statement, the Chancellor has announced a war chest to boost HMRC to help tackle non-compliance. The £161 million will over the next five years “increase compliance and debt management capacity in HMRC”.

It is hoped that the funding will bring in £3 billion in additional tax revenue for the Treasury.

The recruitment and funding of extra staff will provide greater support to taxpayers, tackle the most complex tax risks, ultimately ensuring large and SME businesses pay the tax they owe.

“Don’t hate the player hate the game”

It appears to be little coincidence that the increased resource provided coincides with the matured IR35 reform. The gentle introduction with “soft landing” has ended allowing HMRC to issue penalties in addition to tax bills for non-compliance.

Can HMRC now provide better value and recoup more tax from an end hirer than an individual client?

Additional resources are required to ensure that the new rules are enforced and are effective. The use of such resources is tasked with making taxpayers comply with the new rules.

Own goal

One cannot help thinking that the complexity of IR35 has made it an uphill struggle before a ball has been kicked. Businesses are still grappling with the complexity of being compliant meaning that it is both challenging and expensive. Similarly, HMRC may be investing for several years in certain investigations in order to achieve any result.

If the rules were simpler, they would be easier to follow and enforce…

If you would like to discuss anything mentioned in this article – please get in touch with us on: 0151 433 7333