Pie Cast Episode 4: HMRC loses a trillion

Tax Queen

Tax Expert @ Pie

5 min read

Let’s Break This Down Together...

HMRC’s losing billions, new pension rules are confusing savers, and inheritance tax is hitting small businesses hard. What’s really going on with the UK tax system and what does it mean for you?

Welcome back to PieCast - Episode 4, where we chat about all things money, wealth and tax news that actually matters.

This week, we’re diving into three hot topics:

Why HMRC is bleeding cash thanks to phoenixing schemes.
How billions in pension tax relief go unclaimed and the new rules making it even trickier.
And finally, whether inheritance tax is quietly killing off British entrepreneurship.

Grab a brew, let’s unpack it all.

HMRC vs. the Phoenix Problem

Between 2022 and 2023, HMRC reportedly lost over £800 million due to phoenixing. That’s when a company shuts down, walks away from its debts and tax bills, and then like magic reappears as a new business under a different name.

The year before, the figure sat at £570 million. Now it’s almost doubled.

Phoenixing isn’t new, but it’s growing fast. And while HMRC tries to investigate, the system makes it nearly impossible to catch everyone. With how easy it is to register a company, it’s like playing whack-a-mole with limited resources.

As one of our hosts put it:

“It’s actually impossible for HMRC to keep tabs on every business. There’s just too many.”

For honest businesses and workers, this means fewer public resources, slower systems, and more pressure to raise taxes elsewhere. And that’s on top of 127,000 job losses across the UK and upcoming National Insurance increases in April.

Not a great look for a department already stretched thin.

Billions in Pension Tax Relief, Left on the Table

Every year, an estimated £1.3 billion in pension tax relief goes unclaimed. And with new rules coming in from September 2025, it might get even harder for some people to claim what’s theirs.

Here’s what’s changing:

You can no longer call HMRC to reclaim your extra pension tax relief.
It all moves online.
You’ll need digital evidence either a letter from your pension provider or payslips showing your contributions.

Sounds simple, but it’s another hurdle for people who aren’t tax-savvy or don’t know they’re missing out.

This mainly affects higher-rate taxpayers under PAYE those who automatically get 20% relief but need to claim the extra 20% themselves. Most don’t even realise they’re eligible.

That’s why financial education matters and why platforms like Pie exist. We recently partnered with InvestEngine, adding a one-click link inside their dashboard so users can reclaim tax relief instantly through Pie. Because honestly, if it’s your money you should be able to claim it back without needing a degree in tax.

Is Inheritance Tax Killing British Entrepreneurship?

Another week, another headline about inheritance tax.

Recent reforms are forcing family businesses and farms to sell assets just to cover tax bills. Agricultural Property Relief changes are hitting farmers especially hard people who’ve kept their land in the family for generations are now selling machinery or even parts of their land to pay future tax liabilities.

And it’s not just rural Britain. Entrepreneurs across sectors are feeling it.

“It’s insane,” one of our hosts said. “People who’ve worked their whole lives building something are being punished for wanting to pass it on.”

It begs the question is inheritance tax discouraging entrepreneurship?

If business owners can’t confidently hand over their life’s work to the next generation, fewer people will take that risk in the first place. That’s bad news for innovation, local economies, and jobs.

What It All Means for You

From phoenixing frauds to pension pitfalls, the UK tax system is clearly under strain.

But here’s the silver lining: you can still take control of your finances.

Make sure you’re claiming every bit of tax relief you’re entitled to.
Don’t wait until year-end, use tools like Pie Hub to stay on top of your self-assessment.
Keep an eye on policy changes, because the rules are changing faster than you think.

At Pie, we believe tax shouldn’t be taxing. Whether you’re a PAYE employee or self-employed, we’ll help you find clarity, confidence and cash in the chaos.