HM Revenue & Customs paid almost £350,000 to whistleblowers who tipped the department's investigative team to tax fraud, CSW reported.
The tax agency reported to the National Audit Office (NAO) that it had made £343,500 in payments to people who had provided it with "exceptionally helpful information" in 2017-18, Sir Amyas Morse, NAO's head, said.
HMRC is allowed by law to give financial rewards to people who provide information that helps the department root out tax fraud and evasion. The payments came out of the operational expenditure budget for HMRC's Risk and Intelligence Service - a team in its customer compliance unit with criminal investigatory powers.
There will be occasions where it is appropriate for HMRC to pay a reward to individuals in return for them providing us with information"
A spokesperson for HMRC told CSW that the "vast majority" of people who alert the department to potential tax cheats do so "without any expectation of any financial reward".
"However, there will be occasions where it is appropriate for HMRC to pay a reward to individuals in return for them providing us with information," they added.
"The payment of rewards is at the discretion of HMRC."
Payments of up to £5,000 can be authorised by a senior officer, and up to £10,000 by a civil servant at Grade 7. A deputy director is required to sign off payments of up to £100,000, and a director for up to £250,000. Payments upwards of £250,000 must be approved at director general level. Payments are allowed under Section 26 of the Commissioners for Revenue and Customs Act 2005.
The HMRC spokesperson said it valued information passed on by the public and businesses. "Clamping down on those who try to cheat the system through evading taxes and over claiming benefits is a key priority for us and we are committed to ensuring the tax system operates fairly and efficiently," they added.
"All the information we receive is assessed and a decision made on the most appropriate course of action."
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