18/07/25

UK: HMRC does not know how many billionaires pay tax in the UK

As published on: committees.parliament.uk, Friday 18 July, 2025.

PAC warns of lack of clarity over how much tax is paid or avoided by the very wealthy, as report highlights significant opportunities to collect more revenue.

Public Accounts Committee
HM Revenue & Customs (HMRC) cannot identify how much tax is paid by UK billionaires. In a report on collecting the right tax from wealthy individuals, the Public Accounts Committee (PAC) calls on HMRC to publish its plan for increasing tax yield from wealthy taxpayers both domestically and offshore.

Despite UK billionaires making up a relatively small number of people and the significant sums of money involved, the PAC was disappointed to find that HMRC cannot use the wide range of data it uses to identify wealthy people to provide transparency about the tax paid by the wealthiest. A billionaire has wealth and assets 500x greater than a wealthy person who just meets HMRC’s definition* of ‘wealthy’, and so has huge potential on their own to affect how much revenue is available for public spending. The PAC is seeking HMRC’s plan for improving its understanding of the wealth and assets held by billionaires, including how it might immediately start work on comparing available data on known billionaires, such as the Sunday Times Rich List, with its own records.

HMRC's has done well to ensure wealthy taxpayers comply with tax rules brought in an additional £5.2 billion of tax revenue in 2023-24. This is a significant increase from £2.2 billion in 2019-20. However, the report notes that the scale of this success suggests either wealthy non-compliance has got worse, or that previous estimates of their tax avoidance were too low, and finds that HMRC needs to improve its assessment of the amount of tax that the wealthy avoid paying.

The tax authority told the inquiry that the tax gaps* for wealthy people and for offshore wealth are particularly difficult to measure. Given these difficulties, and the deficiencies in HMRC’s information on wealth, the PAC concerned that HMRC is overly confident and optimistic in its estimate that the wealthy tax gap is only £1.9bn. Its partial estimate of the offshore tax gap, of £0.3bn, seems far too low, particularly when compared with UK residents holding £849bn in offshore accounts in 2019.

The PAC’s report finds that in 2023-24, there were only 25 criminal prosecutions of wealthy people and 456 penalties (down from 1,747 in 2022-23). This is despite the average time HMRC takes to close an investigation increasing every year between 2018-19 to 2022-23. For investigations yielding more than £100,000, the average duration in 2023-24 was 40 months. The PAC finds it particularly disappointing that HMRC has issued no penalties to enablers of tax evasion, despite acknowledging unscrupulous advisers often play a key role in helping the wealthy evade tax, and recommends HMRC assess whether it is using its powers to tackle non-compliance by the wealthy sufficiently, in particular, whether it makes sufficient use of available sanctions.

Committee Member Comment
Lloyd Hatton MP, Member of the Public Accounts Committee, said: “This report is not concerned with political debate around the redistribution of wealth. Our Committee's role is to help HMRC do its job properly ensuring wealthy people pay the correct tax. While HMRC does deserve some great credit for securing billions more in the tax take from the wealthiest in recent years, there is still a very long way to go before we can reach a true accounting of what is owed.

“We already know a great deal about billionaires living in the UK, with much information about their tax affairs and wealth in the public domain. So we were disappointed to find that HMRC, of all organisations, was unable to provide any insight into their tax affairs from its own data - particularly given that any single one of these individuals’ contributions could make a significant difference to the overall picture. We found a similar apparent lack of curiosity in how wide the tax gap is both for the very wealthy and for wealth stashed away offshore.

"Our report shows that, however you slice it, there is a lot of money being left on the table. HMRC must, under its new leadership, begin collecting the correct amount of tax from the very wealthiest - and this must include wealth that is currently squirrelled away in tax havens. There is certainly room for improvement. We hope that HMRC uses both our recommendations and the new funding it has secured in this area to do so.”

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HMRC UK Billionaires Tax evasion