HM Revenue & Customs has handed Lovells a major tax litigation project, the first time the department has outsourced an entire case to an external law firm.
Under the pilot scheme, Lovells will handle every aspect of the prosecution, which is thought to centre around transfer pricing.
HMRC does instruct outside counsel to work with its 250 in-house lawyers but has not outsourced an entire project until now. Lovells tax partner Kevin Ashman is heading the team.
It is understood that the firm has offered a fixed fee its work on the prosecution.
The pilot, instigated by HMRC general counsel Anthony Inglese, involves one of the larger cases on the department’s books.
It is unlikely to unlikely to signal a significant reduction in the amount of work undertaken by HMRC’s lawyers, who will continue to handle the majority of tax prosecutions.
It will however give Inglese the option of outsourcing large projects to the private sector.
The department has also instructed external counsel for Missing Trader Intra Community (MTIC) work, a type of fraud that costs the Government more than £1bn a year.
Howes Percival was given the mandate in England alongside Shepherd & Wedderburn in Scotland.
HMRC spends around £20m a year on external lawyers.