Budget: Modernising HMRC’s wealthy compliance

Who are ‘wealthy’ taxpayers and why focus on them?

HMRC define wealthy individuals as those with income above £200,000 or assets above £2 million in any of the last three years. This population has grown to around 1.3 million people, who contributed approximately £160 billion in tax receipts in 2025–26. While most are compliant, the complexity and international nature of this taxpayer groups’ affairs can create greater scope for error and non-compliance. HMRC estimate the wealthy tax gap for 2024–25 at £3.6 billion (6 percent of the total tax gap) and closing the tax gap is one of the key strategic focus areas for HMRC.

Better identification, segmentation and understanding, and tailoring compliance approaches accordingly

HMRC’s wealthy plan is built around a clearer, more practical understanding of who wealthy taxpayers are and how they engage with the tax system. Instead of relying mainly on income or asset thresholds, HMRC will link data from their own systems, third parties and public sources to build a joined‑up picture of individuals, the entities connected to them and the networks through which their wealth is held. That includes looking at how wealth is created, the use of companies, trusts and offshore arrangements, the sectors people operate in and the life events that can change their tax position.

This fuller view will be used to segment the wealthy population into groups with similar characteristics and behaviours, and to distinguish different levels and types of risk. HMRC will then tailor their approach: giving lower‑risk taxpayers clearer guidance and proportionate contact; using more focused interventions or coordinated oversight through a Customer Compliance Manager where affairs are particularly complex or risks are higher; and reserving specialist cross‑tax and investigative action for the most serious cases. Sector‑specific insight – for example in property, financial services, sport, entertainment and crypto assets – will refine this segmentation, helping HMRC tell the difference between legitimate complexity and deliberate non‑compliance and keeping their responses proportionate as circumstances and risks change over time.

Data, digital and AI enabled compliance

HMRC will use better data and technology to make wealthy tax administration more accurate and timely, and to spot risks earlier. By connecting priority taxpayer, ownership, trust, company, overseas and third‑party data, HMRC will build a single, coherent view of individuals, their assets and structures, including offshore arrangements. Advanced analytics, automated triggers and AI will then be applied to this connected data to pre‑populate services, provide targeted prompts and highlight emerging risks, helping taxpayers and advisers correct errors sooner and enabling HMRC staff to focus specialist resource where it is most needed, while supporting, rather than replacing, expert human judgement.

Investing in capability, and delivering better compliance outcomes all whilst improving taxpayer experience

HMRC are investing heavily in people and capability so they can deal more effectively with complex wealthy and offshore cases. They are expanding specialist teams – including the Complex Cross‑Tax and Offshore team and the High Risk Wealth Programme – and recruiting additional experts in areas such as wealth management, family offices, offshore structures, trusts and inheritance tax. This is backed by structured training through the Tax, Customs and Compliance Academy, stronger knowledge‑sharing and improved assurance, so caseworkers and managers can understand intricate arrangements, assess evidence rigorously and apply penalties consistently.

At the same time, HMRC want better outcomes and a better experience for wealthy taxpayers. Compliance work will be more clearly explained, better coordinated across taxes and teams, and managed to reach fair, evidence‑based decisions at an appropriate pace. Stronger intelligence, specialist capability and tougher use of powers and sanctions will be directed at deliberate non‑compliance and fraud, while debt handling will focus on securing prompt payment from those with the means to pay and responding proportionately where taxpayers face genuine financial difficulty.

Working in partnership with taxpayers, their agents and external partners

HMRC’s plan for wealthy compliance places working in partnership with taxpayers at the centre. They will work openly with wealthy taxpayers, advisers and representative bodies to spot where guidance and processes cause uncertainty and use that insight to improve their services and support compliance. Mandatory registration and minimum standards for tax advisers, backed by stronger powers against those who enable non‑compliance, will help HMRC distinguish and support compliant agents while tackling poor behaviour through proportionate, risk‑based action. Alongside this, HMRC will collaborate with academics and other tax administrations to improve evidence on how wealth is held and transferred, refine their identification and risk models, and explain the limits of their analysis more transparently.

What action should I take

HMRC’s wealthy plan means they will be doing more, and doing it differently, with better data, stronger technology and more specialist teams focused on wealthy taxpayers.

Reviews and enquiries are likely to be better informed and more joined up across taxes and structures, and HMRC will act more quickly where they believes there is a risk.

If HMRC do open an enquiry or contact you under these new arrangements, engaging advisers who specialise in managing HMRC interactions will help ensure HMRC’s compliance activity is carried out within their statutory provisions and compliance guidance in this new environment.

For further information please contact:

• Karmjit Mader
• James Gorin