HMRC steps up action on high street tax fraud – what Leicestershire SMEs need to know

Small businesses across Leicester, Leicestershire and Rutland should be aware that HMRC is increasing enforcement activity aimed at tackling tax fraud and other illegal activity on the UK high street.

As part of a wider national compliance campaign, HMRC has carried out unannounced visits to 13 shops across Leicestershire. The visits form part of a broader programme of tax investigations, organised crime enforcement, seizures and warnings designed to target businesses involved in tax evasion, money laundering and fraud.

HMRC has announced plans to carry out more than 30,000 compliance interventions during 2026–27, with a focus on protecting compliant businesses and preventing criminal activity from gaining a foothold on local high streets.

What this means for SMEs

For the vast majority of businesses that operate honestly and meet their tax obligations, the increased enforcement activity is intended to create a fairer trading environment. Illegal activity can undercut legitimate businesses, distort competition and damage confidence in local economies.

Kevin Hubbard, Director of Small Business and Individuals Compliance at HMRC, said:

“Too many high streets have been blighted by illegal activity that harms communities and undercuts honest businesses. We’re determined to change that.

We’re increasing our action across the UK to target the criminals using shops as a front for tax evasion, money laundering and fraud.

This is a sustained, nationwide effort – and HMRC and its partners will use every power available to dismantle these criminal networks.”

A timely reminder for business owners

HMRC’s increased activity is also a useful reminder for SMEs to ensure their tax affairs are in order. Businesses should make sure they:

• keep accurate financial records
• submit tax returns on time
• report income correctly
• retain appropriate documentation
• seek professional advice if they are unsure about their tax obligations.

Maintaining good financial records and staying compliant can help businesses avoid unnecessary disruption and demonstrate that they are operating responsibly.

For SMEs, this is not simply about enforcement – it is about helping to ensure that honest businesses can compete on a level playing field while criminal activity is tackled more effectively.

As always, if you need support with business planning, financial management, accessing funding, or finding the right advice for your business, give us a call.