Editor's PickForexHMRC boosts efforts to recoup GBP1bn in suspect Covid payouts

November 17, 2021

British tax officials have ramped up efforts to claw back GBP1bn from fraudulent or incorrect furlough payouts, after opening up tens of thousands of investigations against companies.

According to figures disclosed under freedom of information laws, HM Revenue and Customs has stepped up the number of investigations into potentially fraudulent pandemic support claims over the past eight months, with more than 26,500 interventions launched by officials since the spring.

The details, shared with the Guardian, cover the multibillion-pound furlough programme, which was closed at the end of September after subsidising the wages of about 9 million workers in Britain at its peak last year.

It also covers investigations into the Treasury’s parallel income support scheme for the self-employed, as well as Rishi Sunak’s “eat-out-to-help-out” restaurant discount scheme, which was taken up by thousands of hospitality venues across Britain last August.

The latest figures are significant because HMRC had planned to target about 30,000 cases in total over a three-year period. The fact that officials have already opened nearly as many cases this year suggest the total is likely to be much higher than originally anticipated.

With a cumulative cost of GBP70bn to taxpayers so far, the furlough scheme paid 80% of the wages of up to 11.5 million workers placed on leave since the pandemic first struck in March 2020, up to a maximum of GBP2,500 a month.

Sunak extended the programme several times, helping to avoid high levels of unemployment across Britain.

However, it is estimated that more than GBP5.5bn of taxpayers’ money was handed to fraudsters or paid out incorrectly for furlough, the self-employed income support scheme, and eat out to help out.

HM Revenue and Customs acknowledged in its annual report earlier this month that about 8.7% of the GBP60bn it paid out under the furlough scheme in the 2020-21 tax year ended up in the hands of organised crime gangs, fraudsters or was awarded erroneously.

Ministers announced additional funding for the tax authority earlier this year to invest GBP100m in a taxpayer protection taskforce of 1,265 HMRC staff, designed to combat fraudulent and erroneous claims for pandemic support.

A spokesperson for HMRC said: “The Covid support schemes have helped millions of people and businesses through the pandemic, and the government was clear that the priority was getting money to those who need it as fast as possible.

“The taxpayer protection taskforce is expected to recover GBP1bn from fraudulent or incorrect payments over the next two years, and work is already under way, with 26,000 ongoing investigations.”

Read more:
HMRC boosts efforts to recoup GBP1bn in suspect Covid payouts

Leave a Reply

Your email address will not be published. Required fields are marked *

Disclaimer: SmartPeopleMail.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartPeopleMail. All Rights Reserved.

IT'S YOUR OPPORTUNITY OF THE YEAR!
Subscribe for FREE today and get your daily shot of smart news about the Economy and Investing.
We are dedicated to keeping any data we collect from you — safe and secure. Here you can read our privacy policy.