Any person or business can be selected for an HM Revenue & Customs (HMRC) investigation at potentially any time – meaning you never know when an enquiry might be just around the corner.
Facing an investigation
If you are selected for a tax investigation, you will receive a letter from HMRC notifying you of this. In most cases, you will need to respond to this letter within a tight timeframe of between 30 and 35 days, so it is important to act fast. We recommend that you contact us for specialist advice at the earliest possible opportunity to resolve the matter quickly and with minimum disruption to yourself or your business.
Two types of enquiry
Depending on the type of enquiry you have been selected for – which will usually be either an ‘aspect enquiry’ examining a specific aspect of your tax return or a ‘full enquiry’ intending to take a broader look at your finances – the investigation could take anywhere between three and 18 months.
Fortunately, however, this timeframe can usually be cut down significantly if you seek advice in good time.
What will I need to do?
If your business has been targeted, you will most likely be asked to provide the Revenue with details of bank statements, paying-in slips, VAT records, payroll records and more.
If your records are kept electronically, evidence of this will need to be provided.
In some cases, you might be asked to attend a meeting with an HMRC investigator, but with any luck our expert team can help you to resolve the matter long before this becomes likely. In the event that you are asked to meet with an investigator, an accountant might be able to accompany you.
Whatever the circumstances, it is important to act fast and to respond to any written enquiries from HMRC within the stated timeframes throughout the investigation, as the tax authority can issue fines if you are too slow to respond. As mentioned previously, you should seek our advice ASAP.
Tax Enquiry Insurance
HMRC can target any person or business with an unexpected investigation at potentially any time.
Fortunately, you can protect against unplanned professional consultancy fees in the event of this by taking out Tax Enquiry Insurance.
For more information, get in touch with Glazers today.