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Please take some time to read our handy guide covering the different types of tax investigation procedures conducted by HMRC. This article is designed to answer some of most fundamental questions you may have regarding your HMRC investigation. We look at the teams who are likely conducting your case and the procedures that those teams operate under.

For more detailed information on each type of HMRC tax investigation please visit our dedicated pages.

What will happen during an HMRC tax investigation

When the dreaded brown envelope arrives from HMRC most clients ask the same fundamental questions before deciding upon and instruction to act.

Below we answer the most frequently asked questions regarding the HMRC tax investigation process.

HOW SERIOUS IS MY HMRC TAX INVESTIGATION?

You should treat any compliance contact from HMRC very seriously. However, there are varying degrees of seriousness dictated by the procedure HMRC are using you.

WHO ARE THE HMRC FRAUD INVESTIGATION SERVICE

HMRC’s Fraud Investigation Service only deal with cases where the most serious tax fraud is suspected.  They have both civil and criminal teams dependent upon how HMRC intend to proceed.

Any letter from the Fraud Investigation Service; should be given immediate attention and only dealt with by an experienced tax investigation specialist.

WHO ARE HMRC LOCAL COMPLIANCE

Tax investigations launched by local compliance are generally risk based. They make up the vast majority of compliance interventions launched by HMRC are usually dealt with via a check of self assessment tax return.

However, you should remember that HMRC feel that something is wrong with tax affairs. They will suspect that tax has been underpaid as a result. This could be through careless behaviour; but in most instances they will seek to establish that you have acted deliberately.

These cases can quickly escalate or protract if not dealt with correctly by a tax investigation specialist. You should always seek advice and representation before communicating with HMRC on any compliance matter.

WILL I GO TO PRISON?

Criminal prosecutions are still rare. HMRC prosecute approximately 1000 taxpayers a year. However, if you fail to co-operate with HMRC during any civil investigation you could quickly find yourself in trouble. You should always seek advice if HMRC write to you and inform you that an investigation into your tax affairs has begun.

Further reading

HMRC Criminal Prosecution Policy

HOW WILL HMRC DEAL WITH ME?

HMRC will always endeavour to treat you fairly. However to ensure that both you and your tights are protected you should always seek advice and support from a tax investigation specialist.

HOW LONG MY HMRC TAX INVESTIGATION TAKE TO SETTLE?

This is a difficult question to give a definitive answer to. It can depend on several factors.

For example:

  • The nature and scale of the irregularities that HMRC suspect
  • The procedure HMRC are using against you
  • The quality of tax investigation specialist you appoint
  • The personality and experience of the HMRC investigator conducting your case
  • Your approach, honesty and openness

Our average engaged case time to settlement; dealing with tax investigations of varying degrees of complexity – is just 6 months.

Further reading

Check of self assessment tax return

Code of Practice 9

HMRC Compliance Checks

HOW MUCH WILL MY HMRC IT COST ME IN PROFESSIONAL FEES?

Please visit our fees page for more information. We are not the number one tax investigation firm in the UK; we are also the most competitive in terms of our fee structure.

Please visit our tax investigation services page for more information.

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