HM Revenue & Customs – new software trawls billions of items of data & can be shared with 60 other countries

The software, called “Connect”, has been developed at a cost of £80m over seven years. Its basic job is to scour vast databanks of personal and commercial information, seeking to unearth links between individual taxpayers and businesses, income, assets and transactions. It then matches its findings against the information the taxpayer has provided through their return. Discrepancies are flagged and could prompt a tax investigation. This is obviously all long for anyone. From browsing Facebook profiles, to noting careless talk in the pub, to talking to bitter ex-partners, HM Revenue & Customs is watching and listening. HMRC has many connections with other databases, such as the Land Registry, Companies House and the electoral roll. Using Connect, HMRC can sift through information on property transactions, company ownerships, loans, bank accounts, employment history and self-assessment records to spot where estates might be under-declaring. In its first year it raised an extra £26m in inheritance tax. Inspectors can now raid an “unpaying tenants” house, which they did 499 times in the tax year 2011-12.