Fancy a nice little earner? Grass someone up to the taxman.
We all know someone who seems a little bit dodgy. We might even know they are taking “morally wrong" cash in hand. Generally, however, our dislike of the taxman outweighs any personal antipathy towards neighbourly tax dodgers. After all, they're unlikely to be on Goldman Sachs' level are they?
However, times is hard, and the latest figures from HM Revenue and Customs reveal that they made £374,000 worth of 'thank you' payments to members of the public who had been kind enough to grass up their friends, relatives and neighbours.
Investigative website Exaro also revealed this is not a new thing, with over £1m in palm greasing paid out in the last three years. Last year's figure wasn't even the highest figure to date and the last five years amounts show a general upward trend- £309,620 in 2010-11, £384,110 in 2009-10, £281,000 in 2008-09, and £155,950 in 2007-08.
John Whiting, the director of tax policy at the Chartered Institute of Taxation, told The Telegraph: “While many people do not realise that they can get money [for informing], the Revenue does have the power to pay."
So could you do it? Payments range from around £50 up to several thousands, depending on how much tax is recouped as a result of the information provided. HMRC does not promote these bounty payments openly, and you are advised to ensure that any request for payment for informing is made in writing and a record kept. Payments are at HMRC's discretion and depend on “the value of the information and the quality of the result", according to an HMRC spokesman, although he confirmed they are not necessarily a fixed percentage of the tax recouped.
And you can inform on just about anyone. Popular informees are former business partners, former spouses and employers, but you can just as easily grass on “someone bragging in the pub" or your really annoying neighbours.
A total of £42 million of unpaid tax was recovered between 2005 and 2009 as a result of information received from members of the public, according to HMRC, who declined to provide more recent figures. Clearly they did not want anyone working out the percentage of bounty fees to tax avoidance.
HMRC “would expect individuals to think first about the wrongdoing rather than about how much they might make" but at Bitterwallet, we are all in favour of killing two birds with one stone. However, before embarking on a bounty career and spending your life in pubs waiting to overhear some snippets of tax avoidance, note that any cash payment for information is only handed out once any tax has been recovered. And that could take years.
Better get started now then.