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Diverted profits tax brings in £5bn since 2015

10 February 2020
Issue: 4731 / Categories: News

HMRC has secured £5bn as a result of the introduction of diverted profits tax in 2015. This included more than £2.2bn additional corporation tax where diverted profits tax helped settle around 60 investigations. Also HMRC collected £2bn VAT from businesses restructuring their operations as a result of diverted profits tax investigations and £369m from diverted profits tax charging notices.

So far in 2019-20 HMRC has secured another £480m through diverted profits tax investigations. Another 100 investigations are in progress.

The introduction of the tax has resulted in businesses changing their behaviour structures and policies according to HMRC. These changes include increases in corporation tax and VAT as the amount of diverted profits tax receipts begin to fall away. During 2018-19 business restructurings will increase VAT billed through UK companies by around £1.8bn. This is as well as the £0.5bn secured in additional corporation tax from diverted profits investigations.

Jon Claypole...

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