7 September 2026
HMRC generated a record £50.2 billion of compliance yield in 2025/26, the highest level in its history, and continues to expand its compliance workforce. A further 5,500 compliance officers are planned by 2030, more than 2,400 of whom have already been recruited since Autumn Budget 2024. A further 1,100 compliance officers are planned for recruitment in 2026/27.
The government has committed further investment to increase annual compliance revenues by an additional £10 billion by 2030. Together with increased use of data analytics and AI-driven risk assessment, these developments highlight that businesses should expect continued growth in HMRC compliance activity over the coming years, and we are already starting to see this in action.
Many tax and VAT errors arise not through deliberate non-compliance but through misunderstanding complex and frequently changing rules.
One of the greatest challenges facing businesses is keeping staff adequately trained. The pace of legislative and technical change continues to accelerate, and evolving case law requires regular monitoring and ongoing staff development. Even well-managed finance teams can struggle to maintain expertise across every specialist area, and as compliance activity increases, the cost of knowledge gaps grows with it.
There is also an ongoing disparity between HMRC’s treatment of different taxpayer groups. Large businesses benefit from dedicated customer compliance managers, established communication channels and formal risk management frameworks. By contrast, the rest of the business population face enquiries without the same level of ongoing engagement — leaving them more exposed when HMRC’s focus turns their way.
Why this matters now
The likelihood of HMRC interaction is increasing, while tax rules continue to become more complex. Regular reviews, effective staff training and robust governance procedures are essential risk management tools.
Businesses that invest in compliance today are more likely to avoid costly assessments, penalties and management distraction tomorrow, while being better prepared should HMRC come knocking.
A proactive health check can identify historic errors, improve processes and, where necessary, enable disclosures to be made before an HMRC enquiry commences. In many cases, this can significantly reduce potential penalties and demonstrate a positive compliance culture.
As HMRC’s compliance activity continues to increase, businesses should also consider the value of Tax Investigation Insurance. While insurance does not prevent an enquiry, it covers the professional fees incurred in responding to HMRC compliance checks, enquiries and investigations, reducing the financial burden and enabling businesses to obtain specialist advice when it’s needed most.
With enquiries often extending over many months and in some cases years, the cost of dealing with HMRC checks can become substantial, especially compared to the tax investigation insurance premiums. In our experience, the growing number of newer HMRC staff also means checks are taking longer, with some officers pursuing lines of enquiry that a more experienced caseworker would likely have closed down early.
As HMRC’s compliance activity continues to grow, businesses should plan on the basis that an HMRC check is a matter of when, not if
Contact your usual adviser to discuss how a tax health check, training and investigation insurance cover could strengthen your organisation’s compliance position.
