HMRC says 'game is up' for tax evaders

Savers stashing money offshore to avoid paying tax have been warned the "game is up" by HMRC as the Government mulls more measures to prevent tax avoidance, according to reports.

Dave Hartnett, top taxman at HMRC, says "huge" breakthroughs in his department in recent years, including the collection of data from the previous tax amnesty, will help HMRC track down UK citizens dodging tax, the BBC reports.

He says: "The game is fundamentally up," but concedes it is "not comprehensively over just yet".

Hartnett believes the New Disclosure Opportunity (NDO), designed to encourage offshore account holders to settle any tax issues, could raise much more than the £500m predicted over the next four years and produce a "wall of data".

The Revenue raised £450m from the first tax amnesty in 2007 as well as obtaining a wealth of information about tax dodgers, using data from just five high street banks. This year's NDO will use data from over 300 financial institutions.

"We learned a huge amount about the size of deposits, where do people put bigger money, where do they put smaller money and where did the investment bankers put their bonuses," Hartnett says.

HMRC will use such information to track down individuals squirreling money away offshore.

Meanwhile, the financial secretary, Stephen Timms, has attacked the use of offshore havens and has promised to rebalance the system in favour of "honest" workers who pay their taxes, according to The Daily Telegraph.

Timms told a conference of international tax experts the global economic downturn has created a "difficult world" where tax cheats will be pursued.

"It is right for those who pay their fair share to resent - to see, in fact, as morally wrong - the actions of a small minority who use their resources to create a new set of rules for themselves, who think they can pay tax on a 'do it yourself' basis to rob public services of vital resources."

"That kind of behaviour certainly won't wash in the aftermath of the crisis, in a period when spending is going to be tighter," he adds.