Tax Investigations

Tax Investigations

HMRC investigations are rare. However sometimes it may trigger by thinks like an omission picked up by HMRC and at other times it could be random. HMRC also sets up taskforce to target areas of certain industries that are thought to be at high risk of financial fraud. You may be operating in one of those areas.

HMRC also eyes on your trading income and expenses you claim. Suppose if your trading income fluctuates dramatically and expenses or capital allowance claims are excessively high, and it does not co relate to your trade and your returns are always late it may trigger an investigation.

HMRC investigation can be

A compliance check:

A compliance check is any action taken by HMRC to check a person’s or entity’s position in relation to any of the major direct or indirect taxes. More than one tax can be investigated at the same time.

• Enquires into self-assessment tax returns
• VAT assurance visits
• Employer compliance
• Enquires into capital assets disposal or acquisition.

Enquires

If HMRC is satisfied by the explanations and documents, you submit during the compliance check they will close their investigation. If they are dissatisfied, then they open a full scope inquire into your affairs.

Where HMRC finds that the taxpayer has not properly disclosed information it can seek to impose penalties of up to 100 per cent of the tax due plus interest on the late payment of taxes arising from the inquiry. Some tax investigations finish with one letter while other investigations can go on for months with HMRC asking for more and more information.

We can help you in the following ways.

• Collating information and ensuring the correct information is provided to HMRC.
• Dealing with further requests for information.
• Ensuring that HMRC do not extend an inquiry unnecessarily.
• Helping to negotiate a final settlement including interest and penalties.
• Helping to negotiate time to pay.