HMRC is running two enforcement campaigns at once. Overseas multinationals, led by US firms are sitting on an estimated £16.1 billion in underpaid tax, while 81,000 crypto investors have already received nudge letters ahead of automatic global data-sharing that begins in May 2027. For UK practitioners, the window to advise clients on both fronts is narrowing fast.
HM Revenue and Customs is widening its net. Recent data released by national accountancy group UHY Hacker Young highlights a dual strategy from the tax authority: aggressive pursuit of underpaid corporate tax from multinational entities, alongside a technology-driven crackdown on cryptocurrency investors.
These developments signal a clear shift in regulatory focus, requiring proactive advice for both corporate clients and individual taxpayers.
HMRC estimates that overseas companies underpaid £16.1 billion in tax last year, marking a notable increase from the £14.9 billion estimated in the prior period.
While these initial “tax under consideration” estimates often reduce following formal representations, they serve as a direct map of where HMRC perceives significant risk.
Revenue Targets: HMRC has set aggressive collection targets via tax investigations. High-value multinational operations offer the largest potential return on enforcement resources.
Foreign Ownership: A growing proportion of UK economic assets sits under overseas ownership. The Treasury is under political pressure to ensure foreign-owned entities pay tax rates comparable to domestic businesses.
Targeted Measures: Targeted mechanisms are already yielding results. The Diverted Profits Tax (DPT) and Digital Services Tax (DST) together brought in £1.5 billion in additional tax over the past year.
“It is clear that HMRC now has both overseas companies and multinationals in its sights… As we increase the taxes on UK residents, the expectation will be that overseas companies who operate in the UK should also pay their way.”
— Philip Kinzett-Evans, Director at UHY Hacker Young
Parallel to its corporate focus, HMRC is intensifying enforcement around digital assets. Over the past 12 months, the authority issued 81,000 “nudge” letters to crypto holders suspected of underpaying tax, a 25% increase year-on-year.
Current Status: HMRC relies on target requests to UK-based exchanges and voluntary disclosures.
May 31, 2027 (The Turning Point): Under the OECD’s Crypto-Asset Reporting Framework (CARF), HMRC will begin receiving automatic data feeds from exchanges in 52 jurisdictions (including Jersey, Guernsey, the Cayman Islands, Liechtenstein, and Ireland).
2028 Expansion: An additional 15 jurisdictions (including Switzerland, Singapore, and Gibraltar) will begin automatic reporting.
Data transmitted will include complete transaction histories, full legal names, residential addresses, and National Insurance numbers.
“Once HMRC has this data then tax investigations into cryptocurrency investors will be like shooting fish in a barrel. With this data and some fairly basic AI built software, HMRC will be able to build a comprehensive list of all cryptocurrency investors that are behind on their CGT or income tax.”
— Neela Chauhan, Partner at UHY Hacker Young
Practitioners should watch for common misunderstandings among retail and professional crypto investors:
Crypto-to-Crypto Trades: Swapping one token for another is a disposals event for Capital Gains Tax (CGT) purposes, regardless of whether fiat currency was withdrawn.
Offshore Platforms: Using foreign exchanges without a UK bank account connection does not exempt UK tax residents from their worldwide reporting obligations.
Staking & Yield: Income earned through lending or staking digital assets is generally subject to Income Tax rather than CGT.
Clients with unrecorded gains should consider HMRC’s dedicated crypto disclosure facility. Timing is critical to mitigate penalty rates:
Review Corporate Structuring: Audit cross-border transfer pricing policies and permanent establishment risks for foreign-parented clients.
Audit Crypto Portfolios Early: Advise retail and high-net-worth clients to reconcile transaction reports from offshore exchanges before the 2027 CARF implementation date.
Use Voluntary Services: Where underreported crypto gains exist, using HMRC’s disclosure service prior to the receipt of formal correspondence to avoid the higher penalty tier.
