A tax investigation can be a stressful and expensive experience. Particularly if you are unlikely to be familiar with such a process. Any size business can be investigated, from sole traders to large companies. HMRC has increased their resources into enquiries in recent years. This will undoubtably result in an increase in tax investigations, with more businesses receiving enquiries.
Our tax investigation advisors at Alexander & Co have expertise in dealing with a wide range of tax enquiries. These include Inland Revenue and Customs enquiries and investigations. Our experience includes more straightforward enquiries, through to complex serious investigations. For example, from a simple HMRC tax compliance check through to serious investigations by the Special Compliance Office (SCO).
Reasons why you may be subject to a tax investigation
In the UK, tax investigations are conducted by HMRC, and they can be instigated for a variety of reasons. Our expert team can assist on many different types of investigations, assisting with everything from personal to corporate tax investigations. Reasons for a tax investigation may include:
- Mistakes on tax returns
- A random check
- A whistleblower
- Long periods of unprofitability
- Large fluctuation in numbers
- Numbers not consistent with industry standards
What is the HMRC tax investigation time limit?
Time limits apply differently, depending on what type of tax they relate to. This includes, (but is not limited to) capital gains tax, income tax, VAT, corporation tax, and inheritance tax.
Four different time limits apply, in which HMRC can issue assessments:
- 4 years from the end of the relevant tax period
- 6 years on the event of carelessness, from the end of the relevant tax period
- 12 years where it concerns offshore activity, from the end of the relevant tax period
- 20 years for what HMRC perceives as deliberate tax avoidance/evasion
Dealing with HMRC tax investigations
We recently concluded negotiations with HMRC on behalf of a client. Here we agreed to the payment of tax, interest, and penalties totalling £175,000. Although this may seem a lot, SCO originally demanded £875,000. Needless to say our client was delighted.
Does your advisor know about COP9 tax investigations? If not, we can advise you as a client.
Contact Alexander & Co for tax investigation assistance
If you require assistance with a tax enquiry, our experienced tax investigation specialists can assist, whatever industry you operate in. We deal with both personal and corporate tax matters and have experience assisting in a wide range of tax investigations.
Please complete the online form below or email firstname.lastname@example.org. We will then be in touch to discuss how we can assist.
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