The estimated tax gap for the 2020/21 tax year is 5.1% – the second lowest recorded percentage – and is unchanged from the previous year, according to the latest data from HMRC.
The annual “Measuring Tax Gaps” publication estimates the difference between the total amount of tax expected to be paid and the total amount of tax actually paid during the financial year, with HMRC confirming that the vast majority of taxpayers do still pay the tax that is owed, despite the ongoing financial repercussions of the pandemic.
In monetary terms, the tax gap for the 2020/21 tax year is £32 billion, which at 5.1% remains unchanged compared to the previous year, although the monetary value has fallen by £2 billion from £34 billion in the 2019/20 tax year (this is as result of the the total tax due to be paid falling from £672 billion in 2019/20 to £635 billion in 2020/21 due to the economic impact of COVID-19)
Jonathan Athow, HMRC’s Director General for Customer Strategy and Tax Design, said: ‘The vast majority of taxpayers and businesses paid the correct amount of tax owed. We want to help everyone to get their tax right as the revenue we raise helps fund our vital public services.’
To ensure that you or your business are paying the correct amount of tax, contact our expert team for advice.