5. They blackmail

HMRC say, “We know that dealing with our investigation can cost you time and money, so we will make sure that our enquiries are reasonable and necessary to your case. We will close our investigation as soon as we are satisfied that your tax affairs are in order or settled.”

For the belligerent investigator this is meaningless: “as soon as we are satisfied” is a get-out that makes the whole paragraph meaningless.

The belligerent investigator knows represented tax payers are hit in the pocket every time their accountant answers a letter, picks up the telephone or goes into a meeting – £100 an hour is a typical fee.

So after a year of investigation the HMRC officer calls a meeting and presents an unfair settlement figure. The tax payer is then stuck between a rock and a hard place: they either accept the unfair figure or they will risk the case dragging on much longer and so costing a huge amount in professional fees – often more than the settlement figure offered.

This is blackmail and it’s a really common HMRC tactic.

The Consultative Committee of Accountancy Bodies have brought this practice to the attention of the Revenue.