HMRC has raised an additional £4.6 billion in tax through its Connect database, which uses artificial intelligence to analyse bank records, social media and other data sources. The 2024-25 figure represents a 35% increase on the average annual recovery of £3.4 billion in previous years, according to a Freedom of Information request by law firm Pinsent Masons.
Ian Robotham, legal director at Pinsent Masons, described the sum as a 'reasonably significant' portion of the tax gap, which HMRC estimated at £46.8 billion for 2023-24. He said the success of Connect shows that the big data approach is working.
The tax authority said Connect is 'not simply a search tool, but a powerful data-networking, analytical and risk tool' that builds networks from multiple sources to spot patterns impossible for the human eye. However, it declined to reveal the full list of data sources, citing the risk of aiding serious organised criminals.
Robotham claimed the system harvests data from banks, financial institutions, online marketplaces, social media and property letting databases. HMRC confirmed that Connect, introduced in 2010, is used alongside human judgment and is not the sole factor in starting investigations.
