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HMRC collected £27.9 billion less in tax revenues in the 2020/21 tax year than the previous year as a result of the pandemic, according to HMRC annual accounts.

In its 2020/21 annual report, HMRC said it collected £608.8bn in tax, down by 4.4% from £636.7bn collected in 2019/20.

Additional revenues from tackling avoidance, evasion and other non-compliance also fell during the pandemic, down by 18% from £36.9bn in 2019/20 to £30.4bn.

The annual report said the “unprecedented economic circumstances caused by COVID-19” had resulted in lower tax collection.
“Inevitably, the scale of the economic impact caused by COVID-19 had some effect on tax revenue. If individuals and businesses are generating less taxable income, there is less revenue to collect,” it added.

HMRC’s debt balance increased during the pandemic from £35bn to £57.5bn, partly due to deferrals of VAT and self-assessment income tax payments.

See the full report

 

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