Tax Investigation Specialists

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    FAQs

  • 7 Sep 2015
  • HMRC has opened an enquiry on me, what should I do?

    If HMRC have written to you telling you they have opened an enquiry into your tax affairs, then it is likely they will ask you to supply further information in order to help them in their enquiries. It is important that at this point you get professional advice and guidance.

    How can we help? We will review correspondence from HMRC and provide advice on how to proceed. If you choose to engage us to help with your enquiry we will deal with all HMRC’s correspondence on your behalf acting as a buffer between you and HMRC during the course of the enquiry/investigation.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    Will I need to meet with HMRC?

    You may be invited to a meeting with HMRC but there is no lawful obligation for you to attend. In fact it’s not unheard of for HMRC to invite themselves to a meeting at your business premises, however despite their enthusiasm for such visits or meetings in reality HMRC have, in most cases, very limited rights to insist upon a meeting or site visit.

    How can we help? We will act as a buffer between you and HMRC.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    How far back can HMRC go?

    In the case of suspected fraud HMRC can go back 20 years in order to try and recover any lost ‘tax’. However, HMRC need to be able to demonstrate that you have acted deliberately.

    In the cases of ‘careless’ actions HMRC can only go back and recover tax for the last 6 years.

    How can we help? With experience and expertise we will be able to negotiate your position with HMRC in order to minimise your exposure to penalties and the overall liability. If you find yourself in the position of suspected fraud it is important you seek professional advice and guidance immediately.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    What information can HMRC ask for?

    HMRC can ask for any information that they want, this is where professional expertise is really valuable. With our experience and expertise we can look at what information HMRC are requesting and then agree with them what is reasonable and what they are entitled to and more importantly what they will be supplied. These are often three completely different answers.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    How long will my tax investigation take?

    As each enquiry is different it is impossible to sensibly set a timescale. Each case is unique and involves us looking at the circumstances of the enquiry, the size and the complexity. However, we would usually expect most enquiries to be substantially complete within a year, with more complex ones taking a little longer.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    What is Code of Practice 9?

    Code of Practice 9 is issued as part of the Contractual Disclosure Facility (CDF) and is solely used by HMRC’s Fraud Investigation Service. Code of Practice 9 is a leaflet which sets out HMRC’s position on, and how to complete the Contractual Disclosure Forms and is used in cases of suspected serious fraud.

    The offer to take part in the Contractual Disclosure Facility (CDF) and the issue of Code of Practice 9 are only undertaken by HMRC in cases where HMRC suspect serious tax evasion.

    It is an individual’s one off opportunity to make a full and complete disclosure of all tax irregularities, whilst receiving a guarantee from HMRC that they will be immune from prosecution.

    In order to be accepted by HMRC an individual must admit to deliberately not declaring all of their income.

    Immunity can be withdrawn if an individual fails to co-operate with the terms of the CDF and Code of Practice 9 and make materially false statements.

    An individual has 60 days from the date of receipt of the offer to take part in the CDF to accept.

    It is vital that in cases where HMRC suspect serious tax fraud has taken place that professional advice is sought. Poor handling of such cases can result in severe penalties and an individual having their name published on the HMRC website for tax fraud.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    What is the Let Property Campaign?

    The Let Property Campaign (LPC) is a way for anyone who is an individual landlord letting out residential property in the UK or abroad to bring your tax affairs up to date with HMRC.

    If you are in receipt of rental income and you owe tax you need to tell HMRC now. You will then have 90 days to work out and pay what tax you owe.

    You can do this by making a voluntary disclosure to HMRC. In order to participate you must be an individual and renting out a residential property.

    This includes:

    • Renting out a single property
    • Renting out multiple properties
    • Renting out a room in your home for more than the rent a room threshold
    • Living abroad and renting out property in the UK
    • Renting out a holiday home even if you use it yourself

    This campaign is not open to landlords who are letting out non-residential properties such as a shop, garage or lockup.

    You also cannot use the Let Property Campaign if you want to disclose income on behalf of a company or a trust.

    If you make a full and voluntary disclosure of all unpaid liabilities in these circumstances, you can usually expect a lower penalty than HMRC would normally charge if they raised an enquiry or compliance check with the disclosure.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    What is an Accelerated Payment Notice?

    An Accelerated Payment Notice (APN) is a requirement to pay an amount on account of tax or National Insurance Contributions (NICs). HMRC issues APNs to taxpayers involved in avoidance schemes disclosed under the Disclosure of Tax Avoidance Scheme (DOTAS) rules, or counter-acted under the General Anti-Abuse Rules (GAAR).

    HMRC will usually send out a letter some weeks in advance of the APN being issued, to let you know it’s on its way.

    If you receive an APN or notification from HMRC that one is to be issued to you seek professional advice immediately but most importantly do not ignore it.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    What if I do not understand the settlement with HMRC?

    Consult an experienced tax dispute advisor.

    Even at that late stage an experienced tax dispute advisor can make approaches to HMRC and negotiations can result in significant reductions to the overall liability.

    At Pathfinder we have a wealth of experience and expertise available to handle such negotiations on your behalf.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    What is the Worldwide Disclosure Facility?

    The Worldwide Disclosure Facility (WDF) is for anyone who wants to disclose a UK tax liability that relates wholly or in part to an offshore issue.

    An offshore issue includes unpaid or omitted tax relating to:

    • Income arising from a source in a territory outside of the UK
    • Assets situated or held in a territory outside the UK
    • Activities carried on wholly or mainly in a territory outside the UK

    It also includes funds connected to unpaid or omitted UK tax that you have transferred to a territory outside the UK or are owned in a territory outside the UK.

    You may also need to use this facility if you get a letter about your money or assets abroad, have checked your tax affairs, and find you need to make a disclosure. If you’re not resident in the UK, you can still make a disclosure if you meet the eligibility criteria above.

    Disclosures have to be made via the online Digital Disclosure Service and can be done by an individual or an agent acting for them.

    In order to take part HMRC will need to be notified that you will be making a disclosure. This is a simple process where details of address, date of birth and national insurance number need to be provided.

    Once you have notified HMRC of your intention to make a disclosure you will have 90 days to gather the information you need to fill in your disclosure, calculate the final liabilities including tax, interest & penalties, fill in your disclosure using the unique disclosure reference (DRN) given to you when you notify, make your payment of tax.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    What is Code of Practice 8?

    Code of Practice 8 is leaflet issued by HMRC Fraud Investigation Service (FIS) in cases where they suspect tax fraud or tax evasion has taken place and the tax at stake is significant.

    A Code of Practice 8 is carried out on a civil basis but if HMRC suspect serious fraud has taken place they can choose to deal with the investigation under Code of Practice 9 or in some cases, seek to investigate criminally with a view to prosecution.

    Code of Practice 8 (COP8) unlike COP9 gives no guaranteed protection from a criminal investigation, and due to seriousness of the situation and lack of protection from prosecution it is vital that specialist professional representation is sought, to ensure that the process is managed very carefully.

    Failure to engage with HMRC during the course of the investigation will be considered non-cooperation on the part of the taxpayer and will have penalty implications.

    For confidential, no obligation advice call us on +44(0)203 7406786 or email us at enquiries@pathfindertax.com

    If you would like any more help or advice on all types of HMRC tax investigations call +44 (0)203 7406786 now to speak to one of our tax dispute experts.

    Let us know how we can help you
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