Signs that your tax investigation is about to get worse

tax avoidance

Nobody looks forward to a tax investigation.  As soon as they start, you want to know when they will finish.  How much will it cost?

Sadly I do not possess a magic wand.  But I do know some of the tell tale signs that your tax investigation is about to get worse.  These are some of the tell take signs.

HMRC issue Notices under Schedule 36 Finance Act 2008

These Notices cannot be ignored.  Failure to respond in full and by the due date will incur a penalty.

These can be tricky things to understand.  What are they looking for?  What do they think I am guilty of?

HMRC delays in responding

Some taxpayers are initially pleased that there is a delay between the “normal” 30 day turnaround HMRC have regularly insist upon.

Have you stopped to wonder why?

The investigation has been on-going for over 6 months

I don’t know why but HMRC seem to have a fixation that all matters are to be concluded within 6 months.

Certainly if there is a delay (on HMRC’ part) of 6 months, it is likely that the matter is being referred elsewhere within HMRC.  Normally this refers to a specialist but more often I have  found it means FIS are being involved.

Who are FIS?

The Fraud Investigation Service (FIS) investigate tax evasion under the Contractual Disclosure Facility and Code of Practice 9.  Any matter being investigated by a local tax office is escalated up to FIS whenever fraud is suspected.

FIS seek to resolve matters on a civil basis rather than a criminal basis.  FIS are to be taken very seriously.  You may only be one step away from facing a criminal prosecution.

What can be done?

On the basis that HMRC wrote the first letter, de facto they are in charge and keep asking more and more questions.  Will it ever end? .  Shouldn’t you be in charge?

You need a strategy that takes back control and addresses all of HMRC’s concerns.  Do you know what all of their concerns are or is it like pulling teeth?

You need to take time to consider each matter, to research it and to answer their concerns fully.  This may take a week, a month or more as you have to keep your business and home life on an even keel at the same time.  It’s not going to be easy.  You will need help.

Help is at hand

If you have a matter that you wish to discuss, please call me on 07979 313 010 or email me at paul@pmc.tax for a free no obligation consultation.

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