HMRC Tax Investigations
Our expert tax lawyers at Nelson Guest can support you to prepare for, or handle, a HMRC tax investigation, assisting you with specialist support and representation, to navigate the often-difficult territory of business taxation.
Tax law in the UK is subject to frequent changes and is currently more complicated and multi-layered than ever before. The former is particularly true if you engage in complex investments internationally or have a generous income.
If HMRC believes that you have under-reported your income, or haven’t paid enough tax, they’ll enquire about the returns that you’ve previously submitted. If a situation like this arises, it’s imperative that you have the right kind of legal support, to resolve the situation promptly, keeping your business integrity intact.
When it comes to business taxes, it can be difficult to get things right, and making mistakes could mean that you risk damaging your reputation, facing expensive fines, or under certain circumstances, being met with criminal charges.
Our specialist tax solicitors can assist you in many different ways, including:
- Legal guidance to comply with tax regulations
- Advice about HMRC tax investigations
- Preparing responses to HMRC investigations
- Support to negotiate tax penalties
- Assistance to prepare for a tax-related tribunal or court case
Get in touch with our tax solicitors in London today
If your company is under HMRC investigation, or you’re simply looking for legal advice in relation to your taxes, contact our tax solicitors in London today to set up your free 10-minute initial consultation. Call 020 8309 5010 | Ask us a Question | Email us
Navigating this page
- What triggers an HMRC investigation?
- What to expect in an HMRC tax investigation?
- What are the HMRC enquiry time limits?
- What are the potential outcomes of a HMRC investigation?
- What business taxes does HMRC investigate?
- What are the types of HMRC enquiry?
What triggers an HMRC investigation?
There are many different factors that may trigger a HMRC tax investigation, including:
- You make mistakes in your tax return that later need to be corrected
- The tax returns you file do not seem to accurately reflect your lifestyle, or how busy the company seems to be.
- HMRC considers the industry you operate in to be of high risk.
- You miss the tax deadline and file your return late.
- The costs you submit appear to be higher than the average, for a business in your industry.
- HMRC observe that there are large variations between the returns you’ve submitted, or prominent inconsistencies.
- Your business uses bank accounts offshore.
What to expect in an HMRC tax investigation?
If HMRC plan to investigate your taxes, they will usually notify you via telephone, or letter. If you work with an accountant, and this professional is registered as your agent, HMRC will first get in touch with them. You’ll be told which of your records HMRC will conduct an audit on, which is most likely to include your tax calculations, accounts, and company tax returns. The audit may also examine your VAT and PAYE records.
HMRC may consult third parties, with regard to your company operations, and your employees. They’ll take a look at your bookkeeping records and may present you with questions concerning your expenditure and income.
Once HMRC have concluded their investigation, you’ll be informed as to the outcome. If they find your tax is underdeclared you will be charged penalties, depending on the severity and circumstances.
What are the HMRC enquiry time limits?
HMRC are permitted to conduct a full enquiry, so long as they notify the individual within the correct time frame. The time limit for enquiries into a tax return is currently set at 12 months from the date the tax return was filed.
What are the potential outcomes of a HMRC investigation?
There are many different potential outcomes of a HMRC tax investigation. HMRC may find that the taxpayer hasn’t paid enough tax and, if this happens, the individual will usually be asked to pay what they owe, generally with interest, within a 30-day timeframe. In other cases, the company may have paid too much tax and so will be owed a tax rebate.
If HMRC concluded that the individual or business has participated in deliberate wrongdoing, the person or company owner will be asked to pay a penalty. Depending on the severity of wrongdoing, the taxpayer may be faced with criminal charges. If you need support to handle a HMRC enquiry, contact us at Nelson Guest & Partners.
What business taxes does HMRC investigate?
HMRC is well known for investigating business income tax, however, they regularly audit many other types of taxation such as capital gains tax, corporation tax, landfill tax, insurance premium tax and VAT.
To protect your interests as an individual or company, it’s important that you are aware of your responsibilities regarding any type of business taxation that you are eligible for. If you are unsure of your obligations, it’s important that you seek advice from an accountant and a contact a tax solicitor.
What are the types of HMRC enquiry?
HMRC will either conduct an aspect enquiry, or a full enquiry. An aspect enquiry is used if HMRC are only concerned with certain tax entries. These enquiries tend to focus on why a specific item has been claimed.
A full enquiry means that HMRC are concerned about the entirety of the tax return, suggesting that they may suspect under-payment, or wrongdoing, and will likely require your company records for review.
How our tax solicitors can help
Legal guidance to comply with tax regulations
Our tax solicitors at Nelson Guest & Partners can offer individuals and businesses the legal guidance they need to comply with tax regulations. New entrepreneurs aren’t always entirely sure of tax best practices and responsibilities and making errors can quickly compromise the success and reputation of your new venture.
Our experienced team can offer the necessary support to avoid unwanted setbacks. We can advise businesses as to the best practices, to prevent HMRC tax investigations in the first place, potentially saving you time and stress.
Preparing responses to HMRC tax investigations
If your taxes are under investigation by HMRC, we can offer you assistance to prepare the responses required. Responding in the correct way could be the difference between a closed case and an escalated enquiry, which is why, if you’re being investigated, it’s paramount that you receive legal assistance right away.
We have plenty of experience supporting businesses across all industries, to respond to HMRC investigations, and ensure the most favourable outcome moving forward.
Support to negotiate penalties
If HMRC have found your company to have underpaid your taxes, you may incur a penalty, depending on the situation. At Nelson Guest & Partners we are specialists in negotiating penalties with HMRC, for the benefit of businesses like yours.
We appreciate the different circumstances may have led to taxation mistakes and errors. Our tax lawyers are in a fantastic position to support you and resolve your predicament swiftly.
Assistance to prepare for tribunal or court cases
In certain situations, you may need to attend a tribunal or court hearing, for example, if HMRC suspects your business of deliberate wrongdoing, or a serious tax offence. We appreciate that these circumstances can be incredibly stressful, but rest assured, our team are well equipped to support businesses with civil or criminal ligation.
Get in touch with our tax solicitors
If your company is under HMRC tax investigation, or you’re simply looking for legal advice in relation to your taxes, contact our tax solicitors in London to set up your free 10-minute initial consultation. Call 020 8309 5010 | Ask us a Question | Email us