Taking a page from the United States’ success with offering rewards to whistleblowers who provide valuable information about tax fraud, the United Kingdom announced as part of its November 2025 Budget a new whistleblower program to fight large-scale tax evasion. The new “Strengthened Reward Scheme” offered by His Majesty’s Revenue and Customs (HMRC) provides discretionary financial rewards for people who report tax evasion or avoidance when the information leads to the collection of at least £1.5 million in taxes. The program is intended to combat the huge “tax gap” that exists in the UK, where the difference between the amount of tax owed and the amount of tax revenue collected reached an estimated £47 billion in the 2023/2024 fiscal year, or the equivalent of over $62 billion.
How the UK Tax Whistleblower Program Works
The program, which is designed to incentivize people with high-quality, inside information to come forward by offering them a considerable financial stake in the outcome, goes into effect on April 6, 2026. The awards available under the program range from 15% to 30% of the amount collected if the information is original, specific, credible, and not publicly known. The program excludes taxpayers involved in the reported wrongdoing, anonymous tipsters, and those acting on behalf of others.
The US Internal Revenue Service’s successful tax whistleblower program served as a model for the UK’s Strengthened Award Regime. The IRS’s Whistleblower Program has recovered over $7.37 billion that would have been otherwise lost to tax fraud or avoidance since 2007 and has paid over $1.3 billion dollars in awards to whistleblowers.
While the UK’s program to report tax fraud is modeled in some ways after US whistleblower programs, there are a few notable differences.
Rewards Under the UK’s New Program Are Discretionary
Unlike most awards made to whistleblowers under the US’s IRS Whistleblower Program, awards made under the UK’s new Strengthened Reward Scheme program are in the discretion of HMRC. The program does not offer an opportunity for whistleblowers to appeal if denied an award.
In comparison, Congress largely replaced the Internal Revenue Service’s discretionary rewards program with a mandatory award regime in 2006. Under the IRS program, a whistleblower is eligible for a reward ranging from 15% to 30% of the proceeds collected when a whistleblower presents original information that contributes to the recovery of the funds and fulfills certain eligibility criteria. Whistleblowers often take huge risks exposing wrongdoing, including the possibility of suffering from employment retaliation. Whistleblower award programs that provide non-discretionary awards are more effective at encouraging whistleblowers to come forward to expose wrongdoing.
As with the IRS program, the US has embraced mandatory whistleblower rewards in other fields. For example, Congress updated the False Claims Act in 1986 to provide rewards of at least 15% for successful eligible whistleblowers after hearing testimony that the lack of certainty discouraged whistleblowers from stepping forward. In 2010 Congress replaced the Securities and Exchange Commission’s (SEC) discretionary program with a mandatory rewards program; and most recently Congress updated the Anti-Money Laundering Whistleblower Program in 2022 to make rewards mandatory for eligible whistleblowers.
The UK’s Program does not Allow Awards for Anonymous Reports
The Strengthened Reward Scheme does not allow whistleblowers who make anonymous reports to HMRC to receive financial rewards. Only whistleblowers who identify themselves when submitting information to the department can be eligible for rewards. It is not yet clear whether HMRC will provide protections to maintain whistleblowers’ anonymity to the public. But without such protections for whistleblowers, the UK’s new program may miss out on valuable insider information on tax evasion.
Allowing whistleblowers to maintain anonymity is a large contributor to the success of many of the US’s whistleblower programs. For example, both the SEC’s and the Commodity Futures Trading Commission’s (CFTC) whistleblower programs allow individuals to report anonymously if they file a tip through an attorney who complies with requirements for anonymous reporting. Remaining anonymous can help whistleblowers to avoid retaliation and other negative consequences of being publicly identified as a whistleblower. By removing one of the disincentives for whistleblowing, these laws encourage whistleblowers to come forward when they might otherwise choose not to do so.
UK’s Strengthened Reward Scheme Marks a Positive Shift
Although the Strengthened Reward Scheme does not go as far as some US Whistleblower Programs in offering mandatory awards for eligible whistleblowers and maintaining confidentiality, the updates to the program are a welcome sign that the UK may be embracing a more whistleblower-friendly outlook.
In recent years, attitudes in the UK towards whistleblowers have not been favorable, but the UK’s embrace of a more “US style” tax whistleblower program in the Strengthened Reward Scheme may herald a trend towards more positive attitudes towards whistleblowers among UK lawmakers and the public. If whistleblowers can help achieve the UK’s worthy goal of closing its tax gap, that may further help to change attitudes.
Phillips & Cohen Protects Tax Whistleblowers
Phillips & Cohen has extensive experience representing whistleblowers and understands the complexities of reporting wrongdoing to authorities. If you know of tax evasion and would like to speak to an experienced whistleblower attorney, contact Phillips & Cohen for a confidential review of your case.