New research commissioned by HM Revenue & Customs (HMRC) has found that just 4% of taxpayers are likely to be deliberate tax dodgers whilst the vast majority (83%) of those who are aware of their tax obligations are willing to comply.

The findings also reveal that over 26% of taxpayers fail to meet their tax liabilities because they simply don’t understand the tax system.

It suggests that HMRC’s increasingly aggressive stance in tax investigations is not proportional to the threat posed.

Comments Clive Gawthorpe, Tax Partner at UHY Hacker Young: “From the many tax investigations that we have seen, HMRC’s attitude seems to be that most business owners or taxpayers are guilty of non-compliance until they can prove their innocence. These figures show that such level of suspicion is widely unfounded.”

Editorial comment: Various commentators have been asking what HMRC's management is up to. Service standards are still shocking, the PAYE computer is the latest casualty – in a long line of problems – and no one has a local office to go and obtain advice any more. Yet HMRC is still trying to extend its powers; it is currently consulting on a new tax penalty regime for tax agents. If 25% of taxpayers really are getting it wrong the cost to the economy is potentially enormous. Perhaps it would do a better job by devoting its limited resources to tax simplification and collection?

HMRC's report: Individuals Prioritisation An investigation into segmentation of the Individuals customer base