HMRC’s High Net Worth Unit
HMRC’s High Net Worth Unit (HNWU) is a specialist division established in 2009 to deal with taxpayers who have wealth in excess of £20 million. HMRC uses details from tax returns and other public information databases to identify some 6,200 of the country’s highest taxpayers. In certain circumstances, HMRC will also handle family members connected to a high net worth individual from within the HNWU.
HMRC has recently published a new briefing that explains how HMRC deal with wealthy individuals to help them comply with their tax obligations and to challenge those who don’t play by the rules. The briefing explains that HMRC assigns wealthy individuals with a specific customer relationship manager (CRM) who has detailed oversight of their tax affairs and deals with their tax agents. The CRM develops an in-depth understanding of a taxpayer’s affairs and whether they pose any compliance risk.
The unit also has a number of specialist teams. HMRC lists the following examples:
- Finance team – focuses on individuals connected to the finance sector. For example, hedge funds, private equity and banking entities.
- Rising Stars team – deals with people who have rapidly increasing wealth, indicating that they will meet the HNWU’s wealth criteria in the next few years.
- Business Investment Tax Relief team – handles claims for Business Investment Tax Relief from individuals not living in the UK who propose to invest in UK businesses. Not all requests are approved as some do not meet the required criteria.
- Analysis and Intelligence Unit – focuses on using data and analysis to understand the behaviour and financial structures of wealthy individuals, and where their interests lie.
- Dispute Resolution team – works to resolve disputes between HMRC and wealthy individuals in line with HMRC litigation and settlements strategy.
Taxpayers whose affairs are reviewed by a HNWU can expect their files to be be subject to far greater scrutiny than the average taxpayer.