HMRC Enquiries
HMRC enquiries commonly take one of two forms:
Limited scope HMRC enquiries
Every year HMRC will open limited enquiries – basically they ask you to prove one or two figures on your tax returns and if they are satisfied they close their enquiry. If they are not satisfied then they often open a full scope enquiry into your affairs.
At Carbon Accountancy we generally don't charge existing clients for Limited Scope HMRC enquiries.
Full scope HMRC enquiries
Full scope HMRC enquiries mean you must produce all documentation to support your accounts and tax returns. This includes sales invoices, purchase invoices, expense receipts, bank statements, credit card statements, bank paying in books and cheque books. These documents can cover either a full accounting year or more than one year.
A small number of taxpayers are selected randomly for this type of enquiry and in addition, HMRC will open this type of enquiry where they have reason to believe it is appropriate (where for example information has been made available to them concerning specific taxpayers).
Where HMRC finds that the taxpayer has not properly disclosed information it can seek to impose penalties of up to 100 per cent of the tax due plus interest on the late payment of taxes arising from the enquiry.
COP9 Investigations
A COP9 Investigation is carried out by HMRC where they believe a significant fraud has taken place, usually involving more than £100,000 of tax. These investigations can be lengthy and stressful. In addition they can result in substantial penalties being payable.
We can deal with all aspects of HMRC enquiries including liaising with HMRC on your behalf, making voluntary disclosures, negotiating the closure of an enquiry and settlement of any taxes, penalties and interest due. We usually conduct this work on a fixed-fee basis.
