HMRC has published its latest list of deliberate defaulters, naming 196 taxpayers who received deliberate tax penalties, a 30% increase compared to 150 named three months ago, and a 43% rise on six months ago, when 137 were named.

Paul Marcroft, corporate tax partner, RSM UK said: “Penalties totalled £36m on tax liabilities of £56m, meaning fines averaged 65% of the total tax liability. The list also publishes details of those involved, including the nature of the unpaid tax and the taxpayer’s address. As with previous editions, the most heavily represented sectors were construction, trade, retail and hospitality.

“HMRC updates the list every three months, and only includes taxpayers where HMRC has charged a deliberate penalty, the underlying tax liability is more than £25,000, and the taxpayer has not secured the maximum available reduction in penalties through cooperation and disclosure. However, a recent policy paper announced that the tax threshold will increase to £50,000 from November 2026.

“This is the first increase in the tax threshold since HMRC introduced this ‘naming and shaming’ policy in 2009. The recent policy paper explained that the threshold is being increased to £50,000 to broadly reflect inflation since the threshold was introduced, maintain the proportionality of the regime as HMRC moves to publish more information about the defaulter’s deliberate non-compliance, and focus on serious cases of deliberate non-compliance. If the policy had been introduced with immediate effect, 58 taxpayers included in September’s list could have avoided having their detailed published.

“Being included on the list can cause significant reputational damage. It may also cause customers, suppliers and other business partners to question whether they want to continue working with the taxpayer. This is particularly relevant, given HMRC’s increasing focus on supply chain due diligence.

“In certain circumstances, HMRC can seek to recover unpaid VAT through the supply chain under the Kittel principle, where businesses have failed to carry out sufficient checks. As a result, continuing to work with a known deliberate defaulter is unlikely to be viewed favourably by HMRC.

“Only 17 taxpayers had tax liabilities of more than £500,000, while 58 had liabilities of less than £50,000. This suggests that smaller businesses and individuals may be disproportionately represented. This could reflect a lack of access to specialist advice, or a limited understanding of how penalty mitigation works in practice. If these taxpayers had achieved the maximum available reduction in penalties, their details would not have been published, and they would also have avoided the associated reputational damage. It may also reflect the widely held view that small businesses are the largest contributor to the UK tax gap.

“The September 2026 publication is a timely reminder that early action is critical. Where a business or individual identifies a tax irregularity, it’s usually better to seek professional advice and engage proactively with HMRC than to wait for an enquiry to begin.

“Where deliberate behaviour is involved, HMRC’s Code of Practice 9 (COP9) may be relevant. However, taxpayers who make full disclosures under COP9 are not automatically protected from HMRC’s naming and shaming regime. Unless they achieve the maximum penalty mitigation, publication may still occur. Specialist advice at an early stage can therefore play a crucial role in managing the process, maximising mitigation and reducing the risk of public disclosure.”

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