Last year, Danny Alexander, the Chief Secretary to the Treasury, announced that HMRC would create a new ‘Affluent Unit’, targeting those with a net worth of at least £2.5 million. Apparently this is to use ‘new and innovative risk assessment techniques to identify areas where wealthy individuals are avoiding or evading taxes and duties’. I wonder what "new and innovative" means in this context - presumbaly some sort of patterns spotting software of the sort used by the banks to detect fraud?
One year on, at the 2012 conference Mr Alexander revealed that the remit of the Unit would be extended to cover anyone with net worth of £1 million or more. This will increase its audience by two thirds to 500,000. To help cope with the greater number, ‘an extra 100 inspectors and specialists will be recruited’. I guess this means that anyone who's successfully sold a business and owns a house will be on the hit list. Moral of the tale must be that its more important than ever to get some good tax advice and well ahead of any transaction.
So the good news is that the government is - as if by magic - making it easier to be affluent. If this is a geometric progression, then I reckon that by next year you'd only need £400,000 net worth to be affluent and by 2018 we'll ALL be affluent. Truly we are all in this together.