A new study has revealed which types of people are most likely to under-report their taxes or make errors in self-assessment.
The Institute for Fiscal Studies, which published the report, found that more than a third (36 per cent) of self-assessment taxpayers under-report on their taxes.
This rises to almost 60 per cent when looking at just the self-employed.
In terms of gender, men are more likely to under-report than women, at 40 per cent versus 27 per cent.
Most under-payments amount to less than £1,000, but a small number of taxpayers (just less than four per cent) owe more than £10,000 and account for nearly half of the missing tax revenue from self-assessment.
The research also found that bed and breakfast owners and taxi drivers are the least likely to report taxes in full.
Failure to take reasonable care, or negligence when recording sales, was the biggest behavioural trait contributing to the gap, worth an estimated £6.1bn to the exchequer.
Dr Advani, research fellow at the Institute, said “Between errors and deliberate under-reporting, a significant share of self-assessment tax goes unpaid. Audits bring in tax directly, but also change taxpayers’ behaviour. Audits work not because they scare people into complying in future years, but because they give HMRC more information about people’s incomes. The change in behaviour actually brings in more than the original audit.”