HMRC’s large business directorate has doubled the amount of tax revenue it has collected since 2020/21 by using a hand-on approach, says a new report from the National Audit Office.
The large business directorate was established to ensure the UK’s largest business comply with the tax rules. Around two fifths of the UK’s tax revenues comes from this group – some £337 bn in 2024/25.
HMRC takes a more hands-on approach then with other taxpayers due to the complex nature of large businesses and the scale of the revenue collected. A customer compliance manager is assigned to each business.
It is estimated that this approach yielded £15,8 bn in 2024.25, which would have otherwise been lost to the Exchequer. The return on investment on staff is four times what HMRC achieves across all taxpayers, with a £95 return on every £1 spent.
NAO said it found no evidence of HMRC reaching special deals with large businesses on how much tax they should pay.
Gareth Davies, head of the NAO, said: “Through its large business directorate, HMRC has developed an efficient and effective approach to ensuring large businesses remain tax compliant. This has made a significant contribution to reducing the tax gap. HMRC should continue to explore whether this approach could usefully be extended to other complex and high-risk businesses.”
