This Content Was Last Updated on February 9, 2017 by Jessica Garbett
HMRC has issued its annual Tax Gap report.
HMRC’s Tax Gap report says:
‘The tax gap is the difference between the amount of tax due and the amount collected. It is impossible to collect every penny theoretically owed in tax, so a “tax gap” will always exist. For example, we cannot legally collect taxes from companies that owe tax and are insolvent.
‘We estimate the 2014 to 2015 tax gap was 6.5% of total tax and duties due to HMRC – a reduction from 6.9% in 2013 to 2014. This equates to £36 billion, after we deduct the money we secure through our compliance activities. This indicates that more than 93% of tax due was paid in the tax year 2014 to 2015.
‘There is an overall downward trend from 8.3% in the tax year 2005 to 2006 to 6.5% in the tax year 2014 to 2015, although the tax gap has levelled out in recent years.
‘The tax gap estimate of £36 billion is £11 billion lower than it would have been if the percentage tax gap had remained at the 2005 to 2006 level of 8.3%.’
Article from ACCA In Practice