HM Revenue & Customs (HMRC) recouped a record £1.1bn ($1.42bn) in 2023–24. Credit: Ink Drop/Shutterstock.

The number of HMRC investigations into serious tax fraud and avoidance has fallen to a six-year low, reported the Financial Times. 

HMRC tax fraud investigations have also declined from 1,091 in 2022–23 to 480 in 2023–24.  

Known in tax circles as Code of Practice 8 and 9 cases, this drop has raised concerns about the agency’s ability to combat tax fraud. 

The number of Cop9 investigations, which involve the most serious cases of tax fraud, has also seen a decline.  

These investigations fell to 268 in 2023–24, down from 669 in 2018–19.  

Several tax experts have attributed this decline to staff turnover and a lack of resources within HMRC. 

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In response to these claims, the HMRC stated that its fraud investigation teams are focusing their work on the highest-impact and highest-yielding cases.  

The HMRC spokesperson said: “In recent years we have deliberately focused our investigations towards the highest-harm and highest-value fraud, which means the number of these inquiries [Cop9 and Cop8] will change from year to year based on changing risks. 

“The vast majority pay the tax that is due and we use a range of civil and criminal powers to tackle those committing serious fraud. Last year this compliance work protected £34bn of tax that would otherwise have been unpaid.” 

The agency noted that the number of investigations opened had increased after the pandemic, which led to a surge that “swamped” staff and hindered the opening of further cases, according to tax expert Andrew Park. 

In the recent Budget, Chancellor Rachel Reeves revelaed that the HMRC would recruit an additional 5,000 compliance staff to bolster its fraud elimination efforts, with the first 200 beginning training in November.  

Despite the overall decrease in investigations, the HMRC recouped a record £1.1bn in 2023–24. 

Last year, the Association of Accounting Technicians renewed its call for greater government investment in the HMRC’s service levels, following the release of HMRC’s Charter annual report.