HM Revenue and Customs (HMRC) has improved its record of clamping down on tax evaders, according to a report by the National Audit Office (NAO).

The recent campaign against taxpayers who hid income in offshore accounts resulted in an extra £400m in tax, interest and penalties, the report claimed, meaning that for every £1 HMRC spends in this area it now brings in £1.40.

But the NAO has warned that more still needs to be done because the risk of detection is still low, and recommended HMRC focused on self-employed tradesmen and landlords.

"The hidden economy deprives the UK's public services of vital funding and places an additional burden on the majority of honest tax payers who work within the law," said a spokesman.