FAQ
An investigation has been launched what happens next?
The Low Incomes Tax Reform Group have good advice on this, click here.
Can I get free advice?
Yes, look here.
Do the innocent have nothing to fear?
HMRC assumes that you are guilty unless you can prove otherwise. If you are not frightened at this point you have simply not been paying enough attention.
Why me?
There could be any number of reasons and HMRC might be willing to tell you – or not. Here tax expert Anne Eager ACA, CTA from the Robert James Partnership explains why you might have been picked for an enquiry.
Is this enquiry / investigation full or aspect?
This information should be made clear in the HMRC correspondence. Here tax expert Anne Eager ACA, CTA from the Robert James Partnership explains why representation is a good idea.
Do I need good representation?
If HMRC operated a more egalitarian system I’d say yes, however because of the devious practices HMRC employes I have to say: if you have the cash for a good tax advisor then that’s likely to be money well spent. Notice I say “good” because bad tax advisors (and there are many) will be next to useless. Here tax expert Anne Eager ACA, CTA from the Robert James Partnership – who is extremely good – explains why representation is a good idea.
How do I find a good representation?
If an investigation has been opened you need to find an accountant / tax advisor with experience in this area – many are just glorified number crunchers. Be prepared to interview a string of tax advisors: you are looking for somebody who appears to be a dove but is capable of turning hawkish should the occasion demand. Ideally the tax advisor will already know the member of HMRC who has opened the investigation and will have dealt with them in the past – successfully. If you can find a former HMRC inspector to represent you – there are quite a few about – that is a good start.
A good question to ask the prospective accountant is: “I’ve been invited to an interview, should I go alone?” If the tax advisor says “Yes” then avoid like the plague. A good tax advisor – if they decide to go to the meeting at all – will ask HMRC for a full meeting agenda and also get details of the depth of the investigation, ie: is is an aspect enquiry (serious) or a full enquiry (very serious).Tax Aid offer some useful starters.
What will it cost?
High street or home workers start at about £35 per hour and an agent from a big tax firm (like PWC) will bill at around £500 per hour. Tax expert Anne Eager ACA, CTA from the Robert James Partnership comments.
I have no paperwork, what should I do?
Tax expert Anne Eager ACA, CTA from the Robert James Partnership offers advice.
Should I go to the interview?
No, interviews are almost entirely for the benefit of HMRC. They will try to interpret a refusal to attend an interview as non co-operation but provided you answer all their questions in full and on time you can argue that you have complied with the investigation. Tax expert Anne Eager takes a slightly softer line, but is still very cautious.
Should I record the interview?
Don’t go to the interview (see above). A recording will almost certainly put the investigator on the back foot. If you decide to go to the interview on your own (this is high risk) then you should certainly record what is said – when the tape runs out end the interview.
What documents can HMRC ask for?
Generally HMRC will ask for documents that they are not necessarily entitled to see, cheeky! Tax expert Anne Eager ACA, CTA from the Robert James Partnership explains what documents HMRC can ask for.
