Tax Investigations
HMRC Tax Investigation Solicitors
HMRC Tax Investigations wields broad investigative powers. When facing an investigation both companies and individuals need representation from experienced solicitors and accountants who are well-versed in challenging and negotiating with HMRC.
Regardless of whether you are confronted with a civil tax investigation or a criminal one, our tax investigation solicitors and specialist accountants can provide confidential and cost-effective advice and representation.
Tax Investigations
At Axis Solicitors, our expert tax solicitors provide tailored support to help you navigate or prepare for an HMRC tax investigation, offering clear, cost-effective advice and professional representation. If HMRC suspects you have underpaid tax or misreported income, they will typically begin by reviewing your submitted returns. While many enquiries are resolved quickly through correspondence, more complex cases may result in a Code of Practice (COP) 8 or 9 investigation into your finances.
As UK tax laws become increasingly intricate—especially for those with high incomes, complex international investments, or non-domiciled status—errors can easily occur. These mistakes can lead to significant penalties, reputational harm, or even criminal charges. Our experienced solicitors are here to protect your interests, ensuring that any issues are addressed promptly and effectively.
Tax Investigation Solicitors
Our solicitors offer confidential, cost-effective advice and representation if you are under investigation by the HMRC.
While these investigations can take many forms for individuals and organisations., rest assured that our solicitors and accounting specialists are well-equipped to support you through:
- VAT inspections and investigations
- Code of Practice 8 (COP 8) investigations
- Code of Practice 9 (COP9) investigations
- HMRC criminal tax investigations
- Tax evasion and avoidance cases investigations
- Offshore tax evasion and avoidance investigations
Given the potential for fines, reputational damage, and criminal charges related to tax investigations, swift action is imperative to settle matters before they have a chance to escalate. The sooner you are able to present sound legal arguments and when it is plausible, cooperate with the HMRC after consulting with our experts, the greater the likelihood is of achieving a favourable outcome on your behalf.
HMRC Tax Investigations
HM Revenue and Customs (HMRC) is one of the UK’s most resourceful and also powerful investigating bodies. HMRC has the authority to open and conduct civil tax investigations as well as criminal investigations concerning tax or duty evasion, under-declaration, underpayment, and tax fraud.
Civil Tax Investigations
- Occur when the evaded tax is significant
- Can include artificial tax arrangements or avoidance schemes used to underpay tax
- May be used when HMRC believes serious tax fraud has taken place but is prepared to handle it civilly
- Can be upgraded to a criminal investigation if the civil investigation does not proceed appropriately or more serious criminal tax evasion is revealed
Axis Solicitors’ team of tax investigation solicitors, specialised tax law accountants and fraud investigation solicitors are experienced in advising and defending all forms of:
- Tax investigations
- HMRC fraud
- Tax inquiries
- Tax fraud investigations
- Criminal tax evasion
- HMRC investigations and inquiries
For a confidential and complimentary consultation with one of our tax investigation solicitors, please contact us as soon as possible for the best outcome.
Avoid and Mitigate Tax Penalties
Our highly experienced tax solicitors can assist you in navigating complex tax situations and potentially avoiding or mitigating penalties through the following services:
- Assessing tax risk: A thorough evaluation of your tax affairs to identify potential areas of concern and develop proactive strategies to minimise risks.
- Dealing with HMRC correspondence: Expert guidance and support in managing all communication with HMRC, ensuring timely and compliant responses.
- Advising on how to respond to HMRC enquiries: Providing strategic advice on the most appropriate course of action when dealing with HMRC enquiries, helping you understand your rights and obligations.
- Assisting with voluntary and involuntary tax disclosures: Expert support throughout the disclosure process, whether voluntary or prompted by HMRC, ensuring full compliance and maximising opportunities for leniency.
- Representing you at meetings: Attending meetings with HMRC on your behalf, advocating for your interests and ensuring your rights are protected.
- Negotiating penalties: Skilled negotiation with HMRC to potentially reduce or mitigate penalties, securing the best possible outcome for you.
- Preparing for civil or criminal litigation in courts or tribunals: If necessary, providing robust legal representation in court or tribunal proceedings, protecting your interests and minimising potential consequences.
- Keeping your personal tax information private: Maintaining strict confidentiality and ensuring the utmost discretion in handling all sensitive tax information.
Protect Your Interests
If you are facing a tax investigation, seeking legal assistance as soon as possible is essential to mitigate potential penalties. Our tax lawyers can provide support at any stage, even if you are already under investigation or simply want to prepare for the possibility of being targeted.
Proactive Measures to Prevent Investigations
In addition to handling tax investigations, our team can offer guidance to individuals, businesses, and trusts on regulatory and compliance matters. By proactively addressing these issues, we can help prevent investigations from occurring in the first place.
Consult Our Accountants & Solicitors
Our team of tax specialists possesses extensive experience in dealing with all types of tax investigations, as well as any subsequent civil or criminal litigation that may follow. What sets us apart is the collaboration between our skilled solicitors and accountants, who work together to provide comprehensive support.
We have a proven track record of successfully interacting with HMRC and relevant government authorities. Moreover, we have access to our own network of highly skilled tax specialists who can provide additional expertise and consultation on cases that require further specialisation.
Criminal Finances Act 2017
Corporate Liability for Failure to Prevent Tax Evasion
Under the Criminal Finances Act 2017, which came into effect on 30 September 2017, businesses, including companies and partnerships, can be held criminally liable if they fail to prevent the facilitation of tax evasion, whether in the UK or abroad. Crucially, liability can arise even if the organisation was unaware of or not directly involved in the wrongdoing.
This legislation grants HMRC significantly increased authority to tackle tax evasion, placing a heavy onus on businesses to ensure they have effective systems in place to prevent such offences. The only viable defence against this charge is demonstrating that reasonable prevention procedures were in place. Therefore, it is essential for businesses to establish and maintain strong compliance measures to mitigate the risk of prosecution under this law.
Tax Tribunals: Appeal HMRC Decisions
If you disagree with an HMRC decision, you typically have the right to appeal. The first step in this process is to formally challenge the decision directly with HMRC. If this initial appeal is unsuccessful, you can escalate the matter to the tax tribunal system.
The tax tribunal system operates on two levels:
First-Tier Tribunal (Tax Chamber): This is where appeals are initially heard. You will present your case before the First-Tier Tribunal, which will review the details and make a ruling based on the evidence and arguments presented.
Upper Tribunal (Tax and Chancery Chamber): If you are not satisfied with the outcome of the First-Tier Tribunal, you may request permission to appeal to the Upper Tribunal. This appeal can only proceed if the First-Tier Tribunal grants permission, and it will focus on the legal principles and interpretation used in the initial ruling.
To maximise your chances of success, it is essential to present a well-prepared, reasoned, and robust case. Proper legal representation and strategic planning can significantly strengthen your position and increase the likelihood of a favourable outcome in tax tribunals.
Act Quickly
Tax investigations can lead to significant fines, reputational damage, and even criminal charges. Seek legal advice as soon as possible. The sooner you engage with a solicitor from our tax investigations team, the better equipped we will be to build a strong defence and protect your interests.
HMRC possesses broad investigative powers, and their inquiries can take many forms. Whether you are facing a civil tax investigation or a criminal investigation, our specialist solicitors are here to provide you with confidential, cost-effective advice and representation.
We have extensive experience handling a wide range of tax investigations, including:
- VAT inspections and investigations
- Code of Practice 8 (COP8) investigations
- Code of Practice 9 (COP9) investigations
- HMRC criminal tax investigations
- Tax evasion and avoidance cases
- Offshore tax evasion and avoidance
HMRC Tax Investigation Solicitors & Accountants
Axis Solicitors’ team of tax investigation solicitors and accountants have over 15 years of experience in assisting and defending clients while they are facing HMRC cases. Our HMRC tax investigation solicitors deliver effective legal defence when you need it, whether your case involves tax investigations, tax fraud, or any other allegations concerning an individual’s or business’s declared tax.
With our record in tackling complicated and tax cases, our results driven experts take pride in defending both high-profile cases and small business owners in Manchester, Birmingham and London with the same dedication and focus.
FAQ: HMRC Tax Investigations
HMRC tax investigations are inquiries conducted by the UK government to ensure compliance with tax laws. These investigations can be civil or criminal in nature, depending on the severity of the suspected offence.
In cases of suspected tax evasion, VAT fraud, or tax fraud, HMRC may launch a criminal investigation if the offence meets specific criteria. While many tax inquiries are civil and can be resolved without criminal penalties, HMRC will escalate to a criminal investigation in situations where:
- HMRC wants to send a strong deterrent message
- The behaviour involved warrants criminal sanctions
If found guilty following a criminal investigation, individuals or businesses may face severe financial penalties and, in some cases, imprisonment.
HMRC conducts three primary types of tax investigations: Section 9A enquiries, Code of Practice 8 (COP8), and Code of Practice 9 (COP9). These investigations are not automatically criminal and do not necessarily lead to prosecution. However, HMRC may escalate to a criminal investigation if non-compliance or evidence of serious tax offences is found.
A Section 9A enquiry is an investigation by HMRC to review the information provided on your self-assessment tax return. This type of enquiry can either focus on a specific aspect of your return or be selected at random. Typically, these investigations are conducted through written correspondence with HMRC.
A COP8 investigation is triggered when HMRC suspects tax avoidance or minor tax fraud. These investigations usually involve informal meetings and correspondence between you and HMRC, during which they seek to uncover any underpaid tax.
A COP9 investigation is launched when HMRC suspects serious tax fraud but has not yet initiated a criminal investigation. In this case, you are required to provide a comprehensive report detailing your tax affairs, including any actions—whether intentional or not—that may have caused irregularities. Cooperation is crucial, as it can lead to a reduced penalty once a settlement for unpaid tax and interest is reached.
While Section 9A, COP8, and COP9 investigations are civil, HMRC may escalate the matter to a criminal investigation if they uncover evidence of serious tax fraud or non-compliance. Failure to cooperate during the investigation process can also lead to prosecution.
Your behaviour throughout the investigation plays a significant role in determining the penalty. By being transparent, cooperative, and responding promptly to HMRC’s requests, you can potentially reduce the amount of any penalty imposed.
In most civil tax investigations, you and HMRC can reach an agreement on the amount of tax owed and any penalties, which typically avoids the need to go to court. However, if you are unable to reach a mutual agreement or disagree with HMRC’s decision, you have the option to appeal and initiate litigation in either a civil court or a tribunal.
If HMRC escalates the matter to a criminal investigation and finds evidence of criminal offences, you may need to attend court for criminal prosecution.
If you disagree with the outcome of an HMRC investigation, you have the option to request an internal review. This review is conducted by a different HMRC officer who was not involved in the original case. They can either uphold or adjust the findings of the initial investigation.
If you are still dissatisfied with the decision, you can appeal and initiate the litigation process in a civil court or tribunal. During litigation, both you and HMRC will present evidence supporting your respective tax calculations, and the court or tribunal will determine the correct tax figure. If it is decided that you have underpaid, you will be given a deadline to pay the owed tax, along with interest and any penalties. In some cases, you may be allowed to settle the payments in instalments.
While HMRC often deals with minor tax avoidance and fraud through civil litigation, more serious tax offences can result in criminal prosecution.
Common offences that may lead to prosecution include:
- Income tax evasion
- VAT evasion
- Cheating the public revenue
- Providing false information or documents to HMRC
- Smuggling or fraudulently evading excise duties on goods such as alcohol or cigarettes
- Money laundering
If you are under investigation for any of these offences, seek our legal advice promptly to minimise the risk of prosecution and severe penalties.
In an HMRC tax investigation, you will be required to pay any outstanding tax along with interest calculated from the original due date. The penalties you face will depend on whether your case is handled through civil or criminal litigation.
Civil Penalties
HMRC will negotiate a penalty based on the amount of unpaid tax, whether the missed payment was deliberate, and your level of cooperation during the investigation. If an agreement cannot be reached, the penalty will be determined by a court or tribunal. HMRC may also publicly disclose penalties that exceed certain thresholds.Criminal Penalties
Criminal prosecution can result in fines, imprisonment, or both. Regardless of the outcome, you will still be required to repay the tax owed and may also be ordered to cover prosecution costs. In serious cases, you could also be prosecuted under the Proceeds of Crime Act 2002 and the Money Laundering Regulations 2017, which may result in the confiscation of your assets if you are convicted of money laundering.
Tax evasion is treated with great severity, often resulting in substantial penalties. Our solicitors can help you avoid or reduce both civil and criminal penalties.
HMRC Enquiry? We Can Help.
Our HMRC Tax Investigation Solicitors Are On Your Side.
Worried about tax investigations? Benefit from the protection of client privilege with our solicitors and the specialised Tax knowledge of our tax accountants.
Contact us for a confidential discussion.
