Removing the stress of an HMRC tax investigation
You may never have had an HMRC tax investigation. However given the government are always putting HMRC under pressure to collect more tax, the chances are you may come under the Inland Revenues microscope at some point.
One thing is for sure; detailed enquiries from the tax authorities cause stress and anxiety. An HMRC tax investigation can also take up a great deal of your time if not dealt with correctly, so that’s where we can help you.
We specialise in resolving tax investigations, tax enquires, tax disputes and conflicts with HMRC and we will help alleviate the worry of any such investigation.
The technical expertise within our Tax team is second to none. The team is led by one of our Directors Robin John FCA CTA who has a wealth of experience, including that gained as a Tax Partner for a ‘Big Four Practice’.
Ways in which our Tax team will help you include:
Preparing disclosure reports as required under Code of Practice 9 / Contractual Disclosure Facility (suspected serious tax fraud) and preparing unprompted disclosure reports.
- Resolving tax investigations being conducted under Code of Practice 8 (tax avoidance)
- Providing advice in relation to the new tax tribunal system and appeal hearings
- We can help with negotiating tax penalties or other elements of a tax investigation
- Helping individuals, partnerships, offshore trusts or onshore trusts deal with tax enquires
- Working with other professionals to achieve a settlement on behalf of mutual clients
- Dealing with disputes and conflicts with HMRC
Once the investigation has been dealt with satisfactorily, we will then look to the future with you.
We prepare regular and detailed tax planning reports to show where your future tax exposure may lie. We can then advise on possible planning and tax saving strategies as required.
As part of an annual wealth and income planning review, we will keep your tax liabilities to a legitimate minimum.
Call today to book your free no obligation meeting, on 01932 868444 or 0207 381 2022 Contact us.
Tax Investigation FAQs
Why are HMRC investigating me?
- HMRC won’t specifically say why they are investigating a particular company, organisation or individual. Sometimes it is random, or you may be in the HMRC target area or sector (they investigate areas and sectors thought to be at a high risk of fraud).
It can sometimes be for an obvious reason, such as an omission or irregularity picked up by HMRC. Any activity on your tax accounts that may be deemed to be suspicious, such as dramatic rises and falls in income, or excessive expenses in relation to your income, can make you a target for possible tax investigation, or it can be because HMRC have received information from a third party.
How long does a tax investigation take?
- Some tax investigations are over almost before they have started, if a straightforward anomaly is cleared up. Others can go on for months with HMRC requiring more and more information. The length of the tax investigation usually depends on the gravity of the situation.
How far back do HMRC investigations go?
- Technically, HMRC can investigate tax fraud or suspected suspicious activity as far back as 20 years ago. More commonly, HMRC take their investigations back to around 6 years.
What is the procedure for HMRC investigations?
- HMRC will write or phone to say what they want to check. They may ask to visit your home, business or an adviser’s office, or you may be asked to visit them. You may have to pay a penalty if you don’t send them the required information or you refuse a visit.
What information will I need to provide during my tax investigation?
- This will depend on what aspect of your accounts HMRC are checking. You will normally be given an information notice listing all of the documentation and information you must provide.
What powers do the HMRC have?
- In a tax investigation, HMRC have extensive powers to request and secure information from you, the tax payer, from your business and from third parties.
What am I liable to pay following a tax investigation?
- You are liable for any additional tax found to be due, plus interest and penalties.
What are the penalties resulting from HMRC investigations?
- Penalties only apply when it is established from a tax investigation that tax has been underpaid. The penalty will also vary according to a number of circumstances:
- Was the error or omission reported voluntarily?
- What were the circumstances of the omission?
- How much tax was avoided?
Generally, voluntary disclosure of an omissions will be taken into consideration when calculating any penalties. You may just be required to pay any overdue tax. If you voluntarily disclose an error, but your activity was deemed to be careless, you could be fined anything up to 30 per cent of the tax due. Deliberate tax avoidance could result in tax penalties of up to 70 per cent, and that rises to 100 per cent if the error was deliberate and you tried to cover it up.
What is voluntary disclosure?
- This is when you report an irregularity to HMRC before they open a tax investigation enquiry.
Can I appeal a tax penalty?
- Yes. You can appeal if you think your tax penalty is wrong. As a first step your accountant should write to HMRC explaining why you are appealing. However, you cannot appeal against a tax investigation being opened.
Who can help me if I am being investigated by HMRC?
- Your accountant will be able to help you. At Wellden Turnbull we have specialist advisers to help with tax investigations. Our advisers are experts in HMRC tax investigations and can help alleviate the worry and stress of such an investigation. We will help you to collate the correct information, deal with any further requests, and ensure that HMRC don’t extend their enquiry unnecessarily.
We will prepare disclosure reports, and provide advice in relation to tribunals and appeals. We can help you with any dispute or conflict with the HMRC. Moving forward, we can help you with any future tax planning and tax saving strategies.