HMRC Investigations

HMRC can open investigations into your business affairs for a number of reasons. The three most likely being:

• Completely Random – HMRC select a proportion of personal and company tax returns each year to look more closely into
• They do not understand something in your return – this can occur when you may have something unusual that has happened in the year in question. HMRC may wish to understand this more thoroughly, and will ask specific questions in this regard.
• Targeted – HMRC, from time to time, target certain aspects of businesses or sectors to look at more closely.

If the letter asks just one or two simple questions, it is likely that this is a limited enquiry, often referred to as an aspect enquiry by HMRC where they just want to double-check information you have provided. HMRC may ask for documentation to support this information. In a full enquiry you may be asked more extensive questions and be asked to provide your business records if you are self-employed. The enquiry notice should specify whether the enquiry is a full or aspect.

The first thing to do should you receive a letter like this from HMRC is contact us to discuss your position. In most cases we should be able to put your mind at ease and with a simple response to HMRC, in the timeframe requested, the enquiry will close with no adjustments to your tax position.