Well, actually, they know everything!
“Connect” is HMRC’s award winning computer system designed by BAE Systems. Launched in 2010, it cost HMRC £45 million. In HMRC’s “Levelling the Tax Playing Field Compliance Progress Report” published in March 2013, the additional revenues generated by Connect are now around £2 BILLION, a return of more than 40 times the initial investment! Connect is used in almost three-quarters of all risk profiles by HMRC. Guess what, HMRC are not stopping there, they are investing a further £30 million in Connect and other risking systems!
So, what does Connect do? Connect holds more information than the British Library and has made more than 4 billion connections across HMRC’s customer base. It uses a mathematical technique called social network analysis that ploughs through disparate, previously unrelated information to detect invisible networks of relationships. It automates analysis that would have taken months, if it could have been done at all. By linking this data, Connect can uncover previously hidden relationships between people and organisations. For example the system has made links between tax records and third party data which can be derived from hospitals, pharmaceutical companies, insurers and even gas SAFE registrations. The sophisticated software can use DVLA records and the shipping and Civil Aviation Authority registers to help identify owners of cars and planes who declare income that the computer suggests cannot support such purchases. All this at the click of a button!
Following a Plumbers’ tax safe campaign, tax investigations were targeted against five individuals who did not take the opportunity to put their tax affairs in order. Using Connect to link up tax and third party data, such as Gas SAFE registrations, they were made to repay more than £400,000 and received sentences of up to 12 months in prison.
Another example of Connects success was helping HMRC identify an individual who was found to have 11 undisclosed properties in several Mediterranean countries. The total cost of the properties exceeded 1.3 million euros despite the individual declaring UK income of just £6000.00!
Our message is simple, Connect with us before HMRC Connects with you and we’ll make sure you pay the correct amount of tax.