The Inland Revenue (IR) has admitted that it cannot account for more than 500 of its computers.
A spokeswoman told the BBC that the department found it "difficult" to keep track of its 60,000 computers, and added that their 'loss' was probably caused by an auditing problem.
According to government figures, IR staff have lost nine laptops and have had 166 stolen over the last five years. A further 386 PCs have been stolen.
Due to its less than perfect asset management processes, the IR does not know whether those computers have yet been recovered.
The embarrassing revelations came in an official response to a parliamentary question tabled by David Laws, Liberal Democrat shadow chief secretary to the Treasury, about possible computer misuse at the IR and the controversial sale of 600 of its buildings to a private company based in a tax haven, according to the BBC report.
In January, it emerged that some individuals within the department had been illegally accessing tax records of the rich and famous.
The IR was also forced to admit at the time that some privileged tax information had been sold to outside agencies, with some staff passing on details about ex-spouses to the Child Support Agency.
The IR investigated 211 cases of suspected computer misuse last year and took action against 205 employees.
Meanwhile, the BBC has also learnt that more than 1,000 pensioners have not received their winter fuel payments following a computer glitch at the Department for Work and Pensions (DWP). The tax-free £200 payments should have arrived before Christmas. DWP staff are now attempting to find the original paper records and reload the data.