UK tax evasion cases at lowest level in 5 years Cases of serious tax evasion in the UK have hit their lowest level in the past five years as HM Revenue & Customs (HMRC) has ramped up its crackdown on tax evasion. According to figures obtained by Pinsent Mason, the international law firm, there has been a sharp decline in the number of tax evasion cases identified over the past two years, going against the popular notion that tax evasion is on the rise. In the year to March 31 local HMRC offices pinpointed 2,888 suspected cases of serious tax evasion - a 16 per cent drop on the previous year and a 36 per cent drop from 2011 levels. HMRC defines cases of serious tax evasion as being one that is concerned with the evasion of tax totalling £50,000 or more, or if prosecution would be possible. These cases are then passed on to the central "Evasion Referral Team." Phil Berwick, partner at Pinsent Masons, said: "This decline in suspected tax evasion doesn't tally with the rhetoric from some quarters that the British economy is being undermined by a chronic under-collection of tax revenues." He said HMRC now has plenty of tools at its disposal to catch tax evaders and added that this serves as a huge deterrent to those considering tax evasion. "A fall in serious tax evasion cases being identified is definitely not down to any waning of HMRC's determination to pursue tax evasion," he said. Some of the speculation about tax evasion is a little over the top. In recent years HMRC has stepped up its anti-evasion efforts considerably, including introducing new powers for itself. Measures introduced include the ability to impose penalties of up to 200 per cent of the original tax owed if an individual does not declare any income or capital gains that has been hidden from HMRC in an offshore bank account. Another way HMRC can tell if individuals have been cheating is through the use of private sector experts and data to identify possible tax evasion. The Connect System, which uses state-of-the-art data analytics was developed and brought to HMRC by private sector experts. HMRC says high profile advertising campaigns are also heightening evaders" discomfort about not declaring all of their income. Then there is also the overall expansion of HMRC's resources, including hiring 2,500 more tax inspectors. "Five years ago some individuals and businesses perhaps felt that evading tax was relatively easy," said Mr Berwick. Now they can see that HMRC is much more proactive and better informed than in the past. Increasingly, they are deciding that tax evasion just isn't worth the risk.