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HMRC Tax Investigation Services
If you are looking for assistance with responding to a tax fraud investigation, HMRC criminal or fraud investigation or a tax inquiry, the expert team at JMW is here to help.
Our specialists have years of experience dealing with every type of tax investigation and are able to provide a swift, nationwide response, resolving the situation efficiently and effectively. We are keenly aware of the need to protect you or your client’s reputation and privacy, and strive to do so at all times.
Let us reduce the stress and financial implications of a tax investigation. For free initial advice and consideration of documents, call our team on 0345 872 6666 or send us your details using our online enquiry form.
No matter where in the UK you are and regardless of who is under investigation, be it you or a client of yours, we can help. Just some of our specialist services in this area include:
- Specialist advice and assistance
- Immediate response to dawn raids, arrests and interviews under caution
- Conducting a comprehensive and carefully managed disclosure to HMRC to help avoid criminal investigations
- Defence of tax fraud prosecution
- Converting tax fraud prosecutions to civil proceedings, where possible
- Challenging restraint orders
- Challenging confiscation proceedings
- Assistance with Unexplained Wealth Orders (UWO)
Defining HMRC Tax Investigations
HMRC criminal investigations, HMRC fraud investigations and tax fraud investigations relate to a criminal investigation by HMRC into tax evasion, VAT fraud and tax fraud.
A tax inquiry is non-criminal and is an investigation that can be dealt with on a civil basis, avoiding criminal sanctions. However, if the level of fraud or suspected fraud involved meets certain conditions, HMRC will escalate their investigation from a civil case into a criminal investigation.
These conditions include cases where HMRC decides it needs to send a strong deterrent message, or where the conduct involved is such that only a criminal sanction is appropriate.
If found guilty of a criminal investigation, then the convicted parties will face steep financial penalties and, in some circumstances, time in prison. See the FAQs below for the penalties involved in civil cases.
What records might HMRC ask for?
The type of records HMRC might ask for will depend on what exactly it is investigating, but any of the following or more could be required:
- Bank statements
- Payroll records
- Credit card statements
- Sales invoices
- Expense receipts
- VAT records
- Quotes from third parties
- Copies of emails and correspondence
How far back can HMRC investigate?
If only minor adjustments to your tax return are necessary, HMRC may not investigate previous returns. However, if larger adjustments are required then tax returns from earlier years are likely to be looked at.
Generally, if the investigation was triggered by a careless error, then a maximum of six previous years can be looked at in the settlement. However, if the error is deemed to be deliberate, then HMRC has the power to go back 20 years.
What are HMRC tax investigation penalties?
If at the end of a HMRC investigation you are found to owe additional tax then you will be liable for a penalty. The severity of this will take into account the reason for the error.
The reasons that affect the penalty generally fall into the following categories:
- Mistake or misinterpretation
- Failure to take reasonable care
- Deliberate understatement
- Deliberate understatement and concealment
If it is clear that you have made a genuine mistake with your return, then the penalty will be less severe than if you have deliberately falsified the return.
For the occasions where a mistake has been paid, it is like that you will simply be asked to pay the remaining tax within 30 days of the decision. Interest may also be added.
A deliberate mistake will lead to a higher penalty. This could be anywhere between 15-100% on top of your payment, but it could go up to 300%.
In even more serious situations, a criminal prosecution might be brought. Under this circumstance, it is advisable to contact a specialist solicitor for help and advice.
What business taxes does HMRC investigate?
HMRC does not limit itself to investigating only income tax - there are many different types of business taxes that can be investigated. These can include:
- Corporation tax
- Insurance premium tax
- Climate change levy
- Landfill tax
- Capital gains tax
- Construction industry scheme
How long do HMRC tax investigations take?
Unfortunately, there is no time limit on how long HMRC has to complete a tax investigation. It could be weeks, months or up to a year for more complex cases. The length of time will depend on the size and gravity of each individual case, the nature and extent of HMRC’s concerns, your conduct and several other factors.
What if HMRC turns up at my premises with a search warrant?
HMRC has powers to enter premises to search and seize property. However, it is important to instruct a legal representative with the relevant experience because HMRC can sometimes exceed their powers and challenging the exercise of the powers can often be crucial in defending your legal rights. See our guidance on HMRC dawn raids for advice on how you can protect your position.
If requested to attend an interview, do I need to attend?
Nowadays, HMRC often invite persons under investigation to attend a "voluntary interview" rather than rely on the powers of arrest. This means that although you do not have to attend, a refusal risks arrest. The decision to attend an interview can be a matter of expert judgement, and careful preparation for voluntary interviews can make a very important difference to the outcome of the case. We can guide you through the pre-interview process, the interview itself and any resulting action required to protect your position.
What happens if I am prosecuted?
The first port of call should be to instruct a solicitor with appropriate experience to advise on what you can do in your particular circumstances to challenge the prosecution case, properly exercise your legal rights and mitigate the indirect commercial or personal impact of prosecution. This can include financial advice, reputational management, corporate restructuring and other services from associated departments within JMW. Different funding options are available and we can organise a no-obligation discussion to set out your options.
What triggers a HMRC investigation?
A HMRC investigation is usually triggered when figures submitted on a return appear to be wrong or unusual in someway. For example, if a small company suddenly makes a large claim for VAT, or a business with a large turnover declares a very small amount of tax.
However, there are other incidents that could lead to a business coming under investigation. These include, but are not limited to:
- HMRC receiving a tip-off
- Working in an industry that is high risk, for example, one that regularly takes cash payments
- Having a large increase in costs or drop in income
- Significant inconsistencies between different returns
- Repeatedly filing your tax returns late
- Costs that are larger than the industry norm
- Tax returns appearing to be inconsistent with your standard of living
- Being in a sector that HMRC has decided to target
What do I do if I receive a production order?
In most circumstances, you will need to comply with a production order. However, they can sometimes be challenged, so it is important to instruct a solicitor experienced in this field to ensure that the request for information is relevant and not beyond the scope of the particular enquiry/investigation.
What You Need to Know: Unexplained Wealth Orders
Unexplained Wealth Orders (UWO) came into force in January 2018 to help authorities identify and seize property suspected to have been bought by laundered criminal funds, most commonly from foreign sources.
Find out more here in our UWO factsheet about what is entailed in a UWO and what could happen if you were to become subject to one.
Why Choose JMW?
Our team has the expertise and resources necessary to reduce considerably the financial implications and stress of a tax investigation, along with the significant amount of paperwork that comes with it.
Our specialist solicitors are available on a dedicated 24/7 helpline to ensure we can react as quickly as possible to minimise the implications of a tax investigation on you and your business.
What’s more, we have an extensive network of independent tax consultants, forensic tax accountants and specialist tax barristers with whom we work closely and are able to call upon when necessary.
What Our Clients Say
Mr G, Manchester
I just wanted to say thank you for providing an excellent service from start to finish. The job could not have been done any better! Please pass the message onto David, he did a fine job today and I am very grateful to you both.
Mr J, Yorkshire
Sam is every inch the professional, and showed tenacity, effort and attention to detail throughout my case. Words cannot express how relieved I felt at the conclusion of the matter, and the outcome was indeed as Sam had advised at the outset. Anyone who knows the pressure and nightmare of a criminal charge absolutely needs balance, balance of commitment, right choices, dedication to the cause and the client and the power and ability to stay the course.
Sam never flinched from the objective of truth and fact, and without doubt his time and effort paid off. Sincerely I can only say thank you to Sam, and my recommendation would be given without reservation.
I would just like to thank Sam Healey once again for his services. I really couldn't believe the outcome as I expected the worst. If it wasn't for his understanding and hard work it would have been allot worse. I would recommend anyone to use Sam.
Peter Grogan receives more great feedback.
"I began my search for a solicitor by using a search engine online, after contacting a few of these I made my decision to work with JMW...
"This was down to their welcoming, helpful advice from the very beginning. Mr Grogan gave me his personal telephone number and was in contact with me on a frequent basis informing me of the progress of my case. Even better still, he advised me on what he thought would be best suitable for my case and I have to say I am very happy with all of his advice as my case was dropped before attending court. I would recommend JMW solicitors and will certainly purchase their services again if necessary".
Ms W, Money Laundering
"Sam Healey got me through the worst time of my life when I found myself fighting a criminal case for money laundering. Good communication , attention to detail , forward thinking and every inch the professional , Sam worked hard to fight my case with an excellent result. I got my life back. I would highly recommend Sam to anyone caught up in financial crime..."
"I was arrested in 2014 and my case came to court 3 years later in 2017. As a first offender with no knowledge of legal matters nor court proceedings I found myself in the worrying position of not knowing who would best represent me in the specialist field of " Business Crime and Regulation ". With an uncertain future I needed the best representation I could find.
1) I turned to the Internet to find out more about Sam Healey of JMW Solicitors who was recommended , amongst others , to represent me and challenge HMRC who had brought a Money Laundering case against me. The penalty for this type of crime cannot be underestimated. A custodial sentence and the confiscation of your assets comes as a huge shock. The possible loss of your assets and home require very careful consideration of representation at a time when you are least able to cope with your arrest . Sam Healey's internet profile gave me the advantage of selecting him , above others , to have the expertise to represent me .
2) At my request , Sam Healey and I were able to conduct the majority of my case using email . Important documents were scanned between us. This allowed me to travel abroad and reduce the time commuting to JMW Solicitors in Manchester during the 3 year period it took to bring my case to court. I had access to fast communication between us , phone access and fewer conference meetings with him and my barrister. This essentially allowed me to continue to live a reasonable quality of life during the long 3 year period it took to bring my case before the Manchester Crown Court.
3) Sam Healey's ability to explain complex legal situations to me in simple terms and keep me informed of progress with my case are expected by the client. I was not disappointed by him in this area. I can't emphasise this part of client / solicitor work understanding enough. It is essential for the client to feel his / her Solicitor is always fighting their corner and this two way communication confirms that.
4) Legal Aid supported , I had Sam Healey (a Senior Associate with JMW ) , together with my barrister, fighting my corner on the day of sentencing and this was essential to help me through this traumatic day. Although throughout my case some work was passed to other less qualified legal personnel in the team I came to realise that Sam Healey was always aware of my case. Essential for my peace of mind.
5) On the day of sentencing Sam Healey had the forethought to request the Judge consider the apportioning of CPS court costs against me in relation to my co-accused. The result of this was that the Judge gave consideration to the extent that I only had to pay a small 9% of the total costs due to my only having one count against me and the majority counts were against my co-accused. This resulted in a payment of £400 ( plus a victim surcharge of £100 ) instead of £2000 ( 50% apportioned of the costs ) that had to be paid by me personally within 6 months following the closure of my criminal court case. There are always hidden costs that are not covered by Legal Aid and it takes a responsible Solicitor to protect you where he / she can from these surprises. Sam Healey looks out for you in this area.
6) Sam Healey also represents clients with Motoring Offences which is worth noting. I had the misfortune to have my SORN , uninsured car stolen from my home address where it was securely garaged and stored at the close of my case. HMRC give a press release at the conclusion of your case and reveal information regarding the area you reside in which gives an open invitation to thrives to target your home. Sam was quickly able to give me advice as to what I was legally required to do in reporting the theft to the police and DVLA. Although the car has never been recovered , you as the owner must protect your responsibilities regarding your ownership of the car to remain within the law.
7) Although I have still to go through court to fight confiscation proceedings , levied against me by HMRC which will take me into 2018 , Sam Healey's excellent result of a one year suspended sentence , with no conditions attached , have given me my life back and give me strength to face my uncertain financial future at the age of 69 years.
8) Sam Healey's handling of my case gives me the confidence to recommend JMW Solicitors as a first class Legal Company to handle complex cases to those everyday legal matters. The Company is sited in the heart of Manchester , a five minute walk to the Manchester Law Courts and easy access to Barrister Chambers , Saint John Street."
Mr R, Lancashire businessman facing totting-up disqualification
Peter, I wanted to thank you once again for this afternoon. I have absolutely no idea what you said to the prosecution but it obviously worked out well for us!As you may have noticed, I was quite shocked with that outcome as it really isn't how I expected it to go at all.Your experience in these cases shows - I had chosen well!Many thanks for your work.
Mr and Mrs W
Thank you for the good news delivered via your letter. As you know, we felt that this was a case that should never have been brought. The whole experience from start to finish was very stressful.
I wanted to take this opportunity to thank you very much for your expert handling of the matter and your sympathetic approach to our situation. We would heartily recommend your company to any individual or organisation needing services that you offer. Many, many thanks
Peter Grogan was enormously helpful at a very stressful time. He was extremely easy to talk to, and provided both reassurance and practical advice. He followed up our telephone conversations with an emailed summary of the relevant law, which was greatly appreciated. I have no hesitation in recommending his work.
Peter is an excellent solicitor, if asked to recommend a solicitor to a friend in trouble, I would not hesitate to recommend Peter. He is conciousness, bright and personable. He recognises the issues in a case very quickly and provides an excellent service in his ability to address those issues. His client care skills are second to none.
Mr KP, a client facing money laundering charges
It was clear from my first conversation with Evan that he grasped the points when previous solicitors had been beating around the bush.
Mr P, Client facing confiscation enforcement proceedings
It felt like Evan was the only person fighting to keep me out of custody.
Mr R, Managing Director
A quick note to express my thanks for your advice in regard my recent traffic troubles.I will not hasten to recommend you to others, and if I am in need to any legal guidance as the company grows, I will look to you first.