In the wake of various scandals about the NSA spying on US citizens, a scandal of our own is brewing as tax inspectors turn to Google for help identifying taxpayers who earn more than they declare.  

Apparently HMRC are using Google Street View to look at people’s homes here and abroad for evidence they are not declaring their whole income. On one level it makes sense: if someone pays minimum tax and lives in a mansion, I guess HMRC would want to know why. On the other hand there might be a perfectly innocent explanation, or the information might simply be wrong.

The tax inspector look for things like home extensions and improvements, To Let signs revealing potential undeclared rental income, fancy cars parked on driveways and swimming pools. The information they collect is fed into a computer system linking intelligence from Street View with government agency data – Land Registry and housing benefit records – plus data from letting agents, homes to let sites and holiday lets sites in the UK and overseas.

How were HMRC rumbled? It appears the tax consultants UHY Hacker Young discovered the practice when representing clients accused of income tax fraud. HMRC had questioned a client about their income after spotting a sign in the garden advertising a fete at an expensive public school. They wanted to know if they were sending their children there and if so, how they could afford it. As it turned out HMRC was completely wrong. The sign was actually in a neighbours’ garden.  

It must have been awful for the innocent person, being quizzed by HMRC. Many people think the practice is unacceptable, intrusive, even sinister. There are practical issues too. Google Street View soon goes out of date, it isn’t real-time. This means HMRC is relying on out-dated evidence to make accusations that innocent tax payers then have to prove wrong.

HMRC also follows people they think might be tax evaders on social networks including Twitter and Facebook. They use the networks to collect lifestyle and income information from the comments we make and the stuff we upload.

If you want to keep strangers out of your Facebook account, you can do it through your account’s privacy and security settings. Otherwise it’s wide open for anyone to see.

What do you think – should HMRC have the right to examine our lives so closely without us knowing, and is it really practical?