Enquiries by HMRC into Individuals and Companies
Most enquiries or checks are carried out by Inspectors working within HMRC’s local Network. Enquiries into individuals are conducted under Code of Practice 11 while Company Enquiries are governed by Code of Practice 14. Larger and more serious enquiries may be conducted under the Civil Investigation of Fraud procedures under COP 9. Enquiries into businesses may also involve or lead to an Employer Compliance Review under COP 3.
It is rare for the Inspector to explain why the enquiry was started and he is under no obligation to do so. A few enquiries are completely random.
An enquiry may be into an Aspect of the Tax Return, when it will usually be obvious what HMRC are concerned about. Or it may be a Full Enquiry when the Inspector will be considering all elements of the Return and will normally ask to see all the business records.
Inspectors will usually want to meet with taxpayers, particularly where a Full Enquiry is involved. But you do not have to attend a meeting with HMRC;- it is up to you to decide whether that is for the best.
Inspectors will often want to review private documents such as bank accounts and credit card statements. While tax payers will want to disclose any tax irregularities to HMRC it is not always necessary to supply private documents.
Inspectors will use their Information Powers to get their hands on business and private documents if they were not able to obtain them voluntarily. These powers will change from 1 April 2009 making it easier for HMRC to obtain documents and information. These new powers include a power to inspect business premises. Usually, but not always, notice will be given of the Inspector’s wish to inspect premises. While it is not a power of forced entry penalties can arise if access is unreasonably refused.
Any enquiry, investigation or check by HMRC can be a demanding and challenging time.
EDF Tax have the necessary experience, skills and resources to assist you during any HMRC check. Our approach is non judgmental and geared to achieving the best result for you as quickly as possible. While we aspire to a productive relationship with Inspectors of Taxes we will present your case vigorously and robustly. At all times you will be kept informed of developments and options for settlement will always be clearly explained to you.
EDF Tax do not prepare accounts or Tax Returns so your existing accountants retain these roles. We are flexible on how best to support you. We can engage directly with you and bring the enquiry to a conclusion. Or we can work with your accountant to resolve matters or advise on issues such as meetings, private documents, information powers, inspections, penalties and negotiation of the final liability.
We will:
- advise on whether you should attend meetings with HMRC
- advise on what information and documents should be submitted to HMRC
- Conduct correspondence with HMRC and meet with Inspectors
- Advise if HMRC suggest a penalty is due
- Advise on negotiation and litigation
- Advise on whether it is worth having an appeal heard before a Tribunal
- Conclude the enquiry
For further information please contact Iain Macleod on 0115 983 5580 or mobile 07920 146800 or email Iain at imacleod@edftax.co.uk
