Latest news with #taxauthority
The Sun
7 days ago
- Business
- The Sun
HMRC spying on workers' social media posts in tax crackdown
HMRC has admitted to using AI to spy on workers' social media posts as part of a tax crackdown. The tax authority has been using the technology to look at internet posts that might provide evidence of cheating tax bills, according to a report in The Telegraph. In particular it's looking for posts about large purchases or expensive holidays that could trigger a red flag if it looks like someone is spending beyond their means. An HMRC spokesperson has insisted the tools are only being used for social media monitoring in criminal investigations and it won't affect the average taxpayer. They said there are "robust safeguards in place" and it's believed that social media monitoring has been used for a number of years. But concerns have been raised about whether the technology could be used more widely in future. HMRC also looks at workers's financial records, spending habits and tax returns to look for evidence of cheating. It uses an IT system called Connect to look at financial data for routine tax investigation. It's believed HMRC is increasingly relying more on online systems rather than humans to carry out its investigations in a bid to save money. The taxman has also said its staff will use AI to identify suspected tax evaders and send out "automated nudges" asking them to pay what they owe. It comes as Chancellor Rachel Reeves is trying to boost public finances to fill a £51billion black hole in the economy. The Government is trying to avoid raising taxes for working people - but it therefore needs to find new ways to boost the public purse. Raising taxes will kill off growth, Reeves warned as she pledges to rip up business red tape Earlier this year, Reeves announced a fresh £1billion clampdown on tax dodgers that would see HMRC given fresh powers to claw back lost money. Almost £5.5billion was lost to tax evasion in 2022-23, 81% of which was from small businesses. Then there's also taxes that remain uncollected due to HMRC being unable to locate the correct data. The chancellor just days ago approved new rules meaning banks could be forced to share more of their customers' financial details. Under the plans, banks will need to ask new and existing customers with savings accounts for their National Insurance numbers from April 2027. This will make it easier for HMRC to bill savers who have breached their personal savings allowance. HMRC has said it's unable to get hold of taxpayer data properly in about a fifth of cases - meaning there could be millions of pounds worth of tax that doesn't get collected. Warning over AI use Some MPs have raised concerns that using AI to gather evidence of potential tax evasion could lead to errors. They also fear the technology could start to be rolled out more widely by HMRC. Senior Conservative MP Bob Blackman told The Telegraph: "If they suddenly start taking legal action against individuals based on that, it seems draconian and very challenging – to put it mildly. "You've got to have a check and balance. The risk is that AI gets it wrong and someone is pilloried – it seems a bit strange if they start doing that with AI. Without a human check, you can see there's going to be a problem." Sir John Hayes, a former security minister and chairman of the Common Sense Group of Tory MPs, warned it could lead to another Post Office-type scandal. "Where confidential or sensitive material is concerned, people need to be assured that human beings with experience, common sense and judgement are making decisions," he said. "Automated processes remove human interactions. I would be very concerned that we will end up with a Horizon Post Office-type scandal." How do I file a tax return? TO file a self assessment tax retun, you'll need to register with HMRC first, which will then issue you with a Unique Taxpayer Reference (UTR). You must register for self assessment by October 5 if you have to file a tax return and you have not sent one before. You can do so by visiting If you've previously registered and already have a UTR, you don't need to go through this step again. Once you've got your UTR, you can sign in via the "Self Assessment tax return" section of HMRC's website by visiting You can then file your self assessment tax return online. The deadline for sending a return online is January 31 every year. If you need a paper copy of the main Self Assessment tax return, call HMRC on 03000 200 3610 and request an SA100 form. The deadline for sending a return using a paper form is October 31 every year. You need to pay the tax you owe by midnight on January 31 each year. HMRC accepts your payment on the date you make it, not the date it reaches its account. File late and HMRC will issue you with a fine.
Telegraph
11-08-2025
- Business
- Telegraph
HMRC uses AI to spy on social media posts
HMRC has admitted for the first time that it uses artificial intelligence (AI) to spy on taxpayers' social media posts. The tax authority examines workers' financial records, spending habits and tax returns to look for evidence of cheating – as well as posts on the internet. Social media posts about a large purchase or expensive holiday could trigger a red flag if the user seems to be spending beyond their means. A spokesman insisted the tools were only deployed for social media monitoring in criminal investigations with 'robust safeguards in place'. It is understood this has been the case for a number of years, and that all uses of the controversial technology by the tax office are within the law. However, advances in AI are likely to raise concerns about whether HMRC could in future deploy the technology more widely. Bob Blackman, a senior Conservative MP, said: 'If they suddenly start taking legal action against individuals based on that, it seems draconian and very challenging – to put it mildly. 'You've got to have a check and balance. The risk is that AI gets it wrong and someone is pilloried – it seems a bit strange if they start doing that with AI. Without a human check, you can see there's going to be a problem.' The tools used to examine social media in criminal cases exist alongside Connect, a separate IT system used by HMRC to examine financial data for routine tax investigation. The Connect system was first developed over a decade ago, but is thought to be increasingly important as HMRC tries to save money by relying less on human beings to carry out its investigations. It uses billions of data points – including information to spot signs of tax evasion. Rachel Reeves is hoping to make up £7bn of the £47bn 'tax gap' by identifying those who have not paid enough into the national purse. Improvements to the AI software could hold the key to achieving this, after officials last month unveiled plans envisioning its use in 'everyday' tax processes at HMRC. In a 63-page document, HMRC said its staff will use AI to identify suspected tax evaders and send out 'automated nudges' asking them to pay what they owe. The report suggests use of AI within HMRC will become increasingly widespread, with staff currently using chatbots to summarise calls with customers and perform basic administrative tasks. Risks of 'Horizon Post Office-type scandal' The groundwork for the embrace of AI technology appears to have been laid in May, when Labour changed the department's privacy policy. A statement that appears to have been removed said: 'HMRC's use of AI does not replace human judgement when collecting taxes or determining benefits, and our customer services processes always involve human agents.' It now states: 'Where the use of AI could impact customer outcomes, HMRC makes sure that the results are explainable, there is human involvement [and] we are compliant with our data protection, security, and ethical standards.' Senior MPs raised concerns that troves of personal data could be used to make important tax decisions without human judgement – possibly leading to errors. Sir John Hayes, a former security minister and chairman of the Common Sense Group of Tory MPs, said: 'Where confidential or sensitive material is concerned, people need to be assured that human beings with experience, common sense and judgement are making decisions. 'Automated processes remove human interactions. I would be very concerned that we will end up with a Horizon Post Office-type scandal.' Sir John, who has raised questions in Parliament about the use of AI by the HMRC, added: 'The idea that a machine must always be right is what led to the Post Office scandal. I am a huge AI sceptic.' Tax investigators already using AI Fears were raised that AI has already been handed key decision-making powers over people's tax affairs after a legal battle led to the tax office being ordered last week to reveal its use of the software. It came after tax advisors complained AI was used by HMRC when processing applications for tax reliefs that are available to certain businesses. Tom Elsbury, a tax expert, sent a Freedom of Information request in December 2023 to the tax office after he and colleagues concluded AI was used when assessing applications for tax credits by companies conducting research and development activities. HMRC refused to fulfil the request, and the decision was upheld by the information watchdog, but a First-tier Tribunal ruled on Friday that the Government must reveal whether it used AI by September 18. Ministers have insisted that there is always a human 'in the loop' when AI is used for decision-making in Whitehall, while HMRC stated humans will always have the 'final say' in matters that affect people. A similar project to expand AI uses is also being undertaken by the Department for Work and Pensions. It recently took part in a trial that saw 20,000 civil servants use AI technology for three months to draft documents and summarise meetings. A HMRC insider told The Telegraph that officials had asked a dozen tech companies to come up with ways AI could be used to tackle Britain's £46.8bn unpaid tax bill – which is thought to be mostly hidden in offshore bank accounts. AI 'assistants' Government sources said the main use of AI by the taxman was to create two 'assistants' to help the public fill in their tax returns and compliance officers to read them. The customer-facing tool is designed to warn users if they look likely to be submitting false information, based on patterns the system can spot in other users. If the AI tells a user that their return may be wrong, then it could serve as an official warning by HMRC, and lead to a faster crackdown by the authorities if they are later found to have lied, sources said. Compliance officers working at HMRC have also been given AI assistants that they use to sift through data, which ministers think will make the department faster and more efficient at spotting potential tax evasion. However, one source acknowledged that AI tools can make mistakes, and that the Government's new system could introduce errors. A HMRC spokesman said: 'Use of AI for social media monitoring is restricted to criminal investigations and subject to legal oversight. AI supports our processes but – like all effective use of this new technology – it has robust safeguards in place and does not replace human decision-making. 'Greater use of AI will enable our staff to spend less time on admin and more time helping taxpayers, as well as better target fraud and evasion to bring in more money for public services.'
Forbes
30-07-2025
- Business
- Forbes
Why Your Data Gap Could Represent A Significant Financial Risk
Kevin Akeroyd is the CEO of Sovos, the always-on compliance company. Let me paint a scenario, and then you, as a business leader, decide how you would respond: Your largest creditor in a given market comes to you with an invoice and says, 'Based on our data, you owe us this amount.' However, your internal systems don't have the capacity or the interoperability to pull together the data across disparate networks and applications to verify if their invoice numbers are correct. What do you do? If you're anything like me, I'm sure a few choice words come immediately to mind, followed by the sentiment, "There's no way in the world I'm paying this until we can verify that the information and amounts are correct." However, let me add another layer of complexity to this situation. The creditor in question is the tax authority for the country or region in which you're operating. So, delaying or not paying aren't options if you wish to avoid big fines and continue to operate. Farfetched? Not even close. This is a very real scenario that's playing out in countries worldwide as we speak, and businesses are scrambling to adjust to this new reality. New Rules, New Environment Let's examine the fundamental question of what's changed and why this is happening now. Governments across the world have embraced technology and the digitization of the tax collection process, which has paved the way for more sophisticated e-invoicing rules and mandates. Many have shifted from a declarative system of data collection, where businesses report after the fact, to a transaction-based system where they collect data in real time. In total, more than 80 countries currently have some form of e-invoicing requirements for tax compliance and digital invoicing. And these aren't small countries we're talking about; these countries represent the biggest economies in the world. For some, this may seem like an overnight change, but this has been the eventuality ever since Chile pioneered voluntary e-invoicing in 2001 in South America. In 2014, Italy led the European mandate wave. If you think about e-invoicing mandates in technological terms, it closely resembles the Law of Accelerating Returns. Here, the core principle states that evolutionary processes (including technological development) progress exponentially because each stage builds upon and incorporates the lessons and capabilities of previous stages. The acceleration of e-invoicing, stemming from lessons learned globally, has been unprecedented in the past few years. Based on my conversations with regulatory experts around the globe, I feel confident in saying that real-time e-invoicing mandates will be the global standard within a decade. How Does This Impact My Business, And What Do I Do? For businesses operating in countries with e-invoicing mandates, you've already crossed over the line of demarcation. Meaning, you're in a position where the government probably knows more about your business transactions than you do. This is the result of them not only collecting real-time data from you but from all of your suppliers, partners and customers too. Given this reality, it's important to appreciate that you're no longer in the role of declaring your position to the government. They'll tell you what you owe, and it's your responsibility to either pay or have the necessary documentation to defend yourself against it. For many businesses, this is an uneasy position to be in. As these mandates continue to come online, here are five tips that come from my personal observations and many conversations with global experts on both the technology and regulatory sides of the equation. 1. Proactively address this issue. Don't wait for a mandate to become effective to address, implement and test your solutions well in advance. 2. Avoid point solutions that don't communicate with one another; this makes data reconciliation nearly impossible. 3. Standardize your technology to create efficiencies of scale and help avoid the risk of interoperability issues and corrupt data. 4. Ensure that you have a level of systems that can mirror government reporting. This is the only effective way to defend yourself against overcharges and fines. 5. Elevate your compliance program within your organization. This is a core business risk that requires executive sponsorship. Final Thoughts Tax compliance and the ability to avoid costly audits, fines and in some cases, forfeiture of operating licenses is now all about your transaction and finance data. The government has access to more insights, is collecting them in real time and is telling you what you owe and when you owe it. The best way to protect your business is to ensure that you can mirror this insights-based strategy being deployed by governments and tax authorities worldwide. Only then can you defend against any discrepancies and be ever-ready for audits. Companies that can't do this and are left with gaps in their compliance data invite financial risk into their organization. Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives. Do I qualify?
Bloomberg
17-07-2025
- Business
- Bloomberg
UK Non-Dom Population Fell 0.5% in 2024 Tax Year Amid Reforms
The number of wealthy foreign residents in the UK claiming preferential tax treatment on their overseas income and gains fell 0.5% last year as policy makers moved to scrap the regime. Britain had an estimated 73,700 non-domiciled residents in the tax year ended April 5, 2024, down from about 74,100 in the previous 12 months, according to provisional figures published Thursday by the nation's tax authority.
Yahoo
15-07-2025
- Business
- Yahoo
HMRC does not know how much tax billionaires pay, say MPs
The UK's tax authority does not know how much tax billionaires pay, an influential group of cross-party MPs has found, as the government Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
