United Kingdom’s HMRC New Tax Reward Program, Explained by Margaret Finerty
On December 18, Getnick Law Partner Margaret Finerty authored a blog post for The Anti-Fraud Coalition explaining the new tax rewards program launched by His Majesty’s Revenue and Customs (“HMRC”) in the United Kingdom. Margaret details the HMRC’s responsibilities; breaks down the ins and outs of the new program; and explains how it is “designed for success.”
The full text of Margaret’s blog post is below:
On November 26, 2025,[1] His Majesty’s Revenue and Customs (“HMRC”) in the United Kingdom (“UK”) launched a strengthened tax reward program that will pay substantial rewards to individuals who help the UK recover money that should have been paid under its tax laws. The new program enhances and expands HMRC’s pre-existing reward program, targeting large-scale, serious non-compliance by corporations and wealthy individuals, including the misuse of offshore accounts and other tax avoidance schemes.[2] HMRC’s new program is modeled after the successful IRS Whistleblower Program in the United States (“US”).
This is extremely exciting news, not only for the UK, with its potential to close the tax gap and restore funds to the public coffers, but also for the broader international community by providing another weapon to use in the fight against global cross-border economic crime.
The new program is also good news for individuals who have knowledge of serious tax underpayments to the UK because it provides a vehicle for reporting this information to HMRC with the potential to receive a significant reward for doing so.
HMRC and Its Responsibilities
HMRC was established in 2005 by the Commissioners for Revenue and Customs Act. It is responsible for safeguarding the flow of money to the Exchequer through the collection of tax and other required payments, including customs duties, so that the government can fund public services and help families and individuals with statutory financial support. It also facilitates international trade, protects the UK’s economic and physical security at the border, and guards against money laundering. HMRC has both civil and criminal powers to investigate and pursue the underpayment of tax in the UK.[3]
The potential for this strengthened tax reward program is enormous when one considers the number and types of taxes HMRC collects, which include: income tax, corporation tax, capital gains tax, inheritance tax, insurance premium tax, stamp tax, land and petroleum revenue taxes, environmental taxes, Value Added Tax (VAT), and customs and excise duties.
HMRC’s New Tax Reward Program Is Modeled on the Successful IRS Whistleblower Program
HMRC’s new tax reward program is modeled on the successful IRS Whistleblower Program in the US that was established in 2006 when Congress passed the Tax Relief and Health Care Act of 2006[4] and created the IRS Whistleblower Office. The IRS Whistleblower Program enables people with information about tax fraud to help the government recover money that should have been paid under the tax laws and share in a portion of the recovery. HMRC’s new tax reward program is expected to bring in large amounts of revenue to the UK from tax evaders. That is certainly what has happened in the US with its IRS Whistleblower Program. In its most recent annual report to Congress, which covers fiscal year 2024, the IRS Whistleblower Office noted the following accomplishments:
– To date, the program has collected $7.37 billion in unpaid taxes and awarded whistleblowers $1.3 billion.
– In Fiscal Year 2024 alone, the program collected $474.7 million and awarded whistleblowers $123.5 million.
Specific Provisions of HMRC’s New Tax Reward program
HMRC’s new tax reward program includes provisions that mirror key elements of the IRS Whistleblower Program that have made it a success and that are likely to do the same for HMRC’s new program. They include:
– Threshold: HMRC has set a tax collection threshold of £1.5 million[5] to qualify for a reward under the program. This will allow the agency to cull out less significant matters and focus instead on cases with the potential for high returns, thereby allowing for investigative resources to be allocated most efficiently and effectively.
– Floor and Ceiling on Rewards: HMRC has set the range of rewards between 15% and 30%. The floor is crucial to incentivizing informants and their counsel to participate in the program, and the ceiling limits the reward to protect the public fisc.
– No Caps on Rewards: Beyond the percentage limits, there will be no cap on the size of the reward, i.e., the greater the recovery, the greater the reward. This has proven to be key to the success of the IRS -Whistleblower Program in incentivizing high-value claims.
– Certain individuals are ineligible to participate: As with the IRS Whistleblower Program, there are certain categories of people who do not qualify to participate in HMRC’s new tax reward program. They include:
— Civil servants or government contractors who obtained the information during their employment;
— The taxpayer involved in the tax evasion or avoidance;
— The person who planned and started the actions that led to the tax evasion or avoidance;
— A person required by law to disclose, or not disclose, the information;
— A person acting on behalf of another; and
— A person who received the information from an ineligible person.
If the information provided was already known to HMRC (or could have been identified through routine process), or was provided anonymously, a reward will not be given. Interestingly, under the IRS Whistleblower Program, a planner and initiator of the actions leading to the underpayment of tax is not necessarily precluded from an award. The IRS award, however, may be reduced, and will be denied if the person is convicted of criminal conduct as a result of their actions.[6]
Unlike the IRS Whistleblower Program, the rewards under the new HMRC program, as with its original program, are within the HMRC’s discretion. Under the IRS Whistleblower Program, awards are mandatory if certain requirements are met.[7] HMRC has demonstrated a strong desire to make this new program a success. The best way to do that is by rewarding those who come forward with information that brings in substantial sums of tax money that would not otherwise have been recovered. That will encourage more people to report major tax avoidance cases to HMRC.
HMRC’s New Tax Reward Program Is Designed for Success
The most successful results under reward programs are achieved when the government agency and the person providing information (together with their counsel) work together in a public-private partnership to maximize the recovery. Like the IRS Whistleblower Program, the HMRC initiative will empower private individuals to collaborate with the government to uncover significant tax underpayments by companies and wealthy individuals, thereby generating considerable revenue for the government that will benefit honest taxpayers across the UK. This arrangement allows the government to leverage those private resources to effectively expand HMRC’s resources without cost. This new HMRC program provides opportunities for individuals in the US, and around the world, with knowledge of UK tax violations to report this information to HMRC and be rewarded for their efforts. It is a force multiplier that will assist HMRC in fulfilling its mission to the public.
HMRC has a long and accomplished history of successfully working with informants and is poised to take full advantage of the information and resources coming its way. Under this new HMRC program, an enhanced category of informants backed by their counsel’s support will emerge. Once embraced by the highly experienced HMRC investigators, the results should exceed anything seen to date.
[1] The new reward program was included in the Budget 2025 Policy Paper, specifically sections 3.3 and 5.9, which sets forth the details of the 2025 Budget presented on November 26, 2025, by Rachel Reeves, the UK’s Chancellor of the Exchequer, to the House of Commons.
[2] The previous program remains in effect for smaller matters that do not meet the new program’s requirements.
[3] The decision to prosecute an HMRC case criminally is ultimately made by the Crown Prosecution Service.
[4] Pub. L. No. 109-432, 120 Stat. 2922, § 406.
[5] Approximately $2 million USD in 2025.
[6] 26 U.S.C. § 7623(b)(3).
[7]26 U.S.C. § 7623(b)(1).