Nearly 19,000 taxpayers sanctioned over five years

Figures revealed in written Tynwald question

More than 6,200 sanctions were issued to Isle of Man taxpayers in the last financial year for allegedly failing to declare all their income.

Treasury Minister Alex Allinson, says the majority of these actions were not criminal prosecutions but administrative penalties, including fines for late tax returns and interest charges on under-declared income.

The figures were disclosed in response to a written Tynwald question from Ramsey MHK Lawrie Hooper, and cover both income tax and National Insurance-related offences, as well as benefit fraud cases.

The Income Tax Division recorded 208 prosecutions in 2023/24, while there were 4,185 prosecutions for income tax and related Class 4 National Insurance offences over the past five years. 

The majority of enforcement activity involved non-criminal sanctions, such as penalties for late submissions, interest on unpaid tax, and other compliance measures following enquiries.

In the 2023/24 financial year, 5,946 late return penalties were issued, and 83 cases involved detailed investigations triggered by third-party income reporting.

There were 3,872 individuals sanctioned in 2023/24.

Alongside tax offences, Treasury says there's also been activity in relation to social security benefit fraud.

In 2024/25, there were 19 prosecutions for benefits-related offences and a further 139 cases where other sanctions were applied. These included official cautions, warning letters, termination of benefits, or reductions in the amount paid.

Treasury says that prosecutions for National Insurance offences are generally rare, and often relate to failures to pay contributions on time or delays in notifying the start of self-employment. 

In most cases, it says such offences are handled administratively.

A spokesperson for the department said the goal is to support honest taxpayers and encourage compliance through a combination of education, targeted enquiries, and proportionate penalties.

Anyone who's unsure about tax matters is encouraged to contact the Income Tax Division for advice.