25 Jun 2026
The tax gap rose to a record high of £59.2 billion in cash terms for 2024/25, according to the latest data from HMRC.
The tax gap is the difference between what UK tax is expected to be paid and was actually paid.
The gap was 6.4% for the 2024/25 tax year as the tax authority collected £865.2 billion, representing 93.6% of all tax due.
HMRC estimates the tax gap using the most up to date information, and figures are often revised as more data becomes available.
The percentage tax gap has fallen from 7.5% since measurement began in 2005/06, although there has been some fluctuation over that period.
HMRC said the estimates reflect the changing world in which it operates, where it is becoming more difficult to tackle non-compliance through traditional approaches alone.
Ellen Milner, Director of Public Policy at the Chartered Institute of Taxation, said: 'Despite the efforts of successive governments, the tax gap is proving stubbornly hard to keep down. The government's ambitious target of a £10 billion reduction in the tax gap by 2029/30 feels very optimistic.
'The high level of uncertainty around these figures raises questions as to how much HMRC can rely on the data in its decision making and as justification for taking particular courses of policy and compliance action, especially as year-on-year comparisons become more difficult.'