In 2015-16, the taxman imposed 28,663 penalties against those whose inaccurate returns deliberately understated their income, up from 20,740 in 2014-15, a rise of 38%.

In 2012-13, the figure was just 5,162, an almost six-fold rise in deliberate penalties over a period of four tax years.

Mike Down, tax partner at RSM, said: ‘This spike in penalties suggests a marked change in attitude at HMRC and it is clear that inspectors are now taking a much harder line.

‘However, HMRC needs to be wary of the perception that they are engaging in “penalty farming” and ensure they don’t unfairly penalise people who are not seeking to deliberately deceive.’

HMRC has powers to charge a penalty if a taxpayer sends a return or other document that contains an inaccuracy, and the inaccuracy:

• results in tax being unpaid, understated or over-claimed; and
• was careless, deliberate or deliberate and concealed ‘behaviours’.

There is criticism that HMRC is too ‘rigid’ in dismissing reasonable excuse claims, those decisions often being later overturned in tax tribunals.

The penalty is a percentage of what HRMC describes as ‘potential lost revenue’. This is the amount that arises as a result of correcting an inaccuracy in a return or document, an incorrect repayment or an incorrect claim. The HMRC inspector dealing with the check is required to explain how this is calculated. There are different rules about calculating the unpaid tax where there are group relief, losses, repayments, or accounting timing issues resulting in delayed tax.