Tax Investigations - The Facts
- HM Revenue & Customs can randomly select any UK taxpayer for a tax enquiry
- HMRC has been targeted to produce £7 billion of additional revenue each year by 2014/15
- The average tax investigation lasts 19 months and usually cost thousands of pounds in professional representation fees.
- HMRC has recruited an additional 2,500 compliance officers to help tackle compliance activities.
HMRC are able to conduct a variety of different types of enquiries to assess your tax affairs - some of which require ALL of your business books and records. HMRC will then trawl through documentation to identify potential errors and unpaid tax. Whilst you may have done nothing wrong, HMRC will make the most of its legal powers to investigate your business, leaving you to pick up the fees for your defence. Costs for a tax enquiry can quickly add up just from handling the various correspondence and meetings with HMRC.
The information below shows the breakdown of a typical investigation:
| Nature of activity | Ave Time |
| Responding to HMRC’s initial information request | = 4 hours |
| Telephone conversation with Inspector to discuss calculations within your accounts | = 1 hour |
| Meeting with Inspector to review the case | = 5 hours |
| Respond to written correspondence from Inspector | = 1 hour |
| Second meeting with Inspector | = 4 hours |
| Correspondence with Inspector to close the Enquiry | = 4 hours |
| Total | 19 hours |
How would you pay for this representation? Tax Defence means that you don’t need to worry and you will be fully defended by a specialist Consultant for the entire case.