ACCOUNTANCY AGE EXCLUSIVE: Revenue prosecution rate shock

The news emerged as the Revenue began digesting responses to its proposed increased powers of investigation in serious cases of fraud.

Analysis of prosecutions pursued by the Revenue last year, the first in which detailed figures were provided, indicated external cases were taken against 44 people, of which 24 were convicted – a success rate of 55%.

But excluding cases where the accused pleaded guilty, the success rate drops sharply.

From the Revenue’s own figures, of the 24 people convicted, 11 pleaded guilty, four pleaded not guilty. It is unclear how the other nine pleaded.

On this basis, the success in contested cases is at best 39% and at worst 16%.The figures are also likely to overlook the considerable number of cases that are investigated for prosecution but are dropped before they become a ‘criminal proceedings’.

The news comes after the Revenue was revealed to be spending £1 for every 30p it recovers when it investigates suspected tax evasion by the self-employed.

The revelations, made by a former inspector now working in tax investigations at at a mid-tier firm.

According to official documents, the Revenue has ‘a policy of selective prosecution involving the most serious cases across the whole range of the tax system’.

Many blame the dip in successful prosecutions on the drift in expertise from the Revnue’s Special Compliance Office to the private sector.

The figures make shocking reading compared to the success of the Crown Prosecution Service and Serious Fraud Office.

The CPS managed a conviction in magistrates court of 98.3% of cases. In Crown Court, the service got a conviction in 89.1% of cases it prosecuted.

The SFO prosecuted 38 defendants with 31 convicted, six acquitted and in one case the SFO offered no further evidence.

Chantrey Vellacott tax partner Maurice Fitzpatrick said: ‘The Revenue’s declining record of successful prosecutions suggests that they may not be deploying their resources to their best effect.’

Chris Chadburn, national tax investigations partner at Baker Tilly, said: ‘The Revenue should take on the most serious cases but they are not doing it at present.’

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