Expert Legal Defence for Tax Dispute and Investigation

We represent clients across a wide spectrum of tax investigations, ranging from personal and corporate tax disputes to high-level fraud enquiries and international tax compliance issues. The following are the most common types of HMRC investigations where we provide legal support:

Self-Assessment Enquiries

Self-assessment enquiries typically begin when HMRC identifies anomalies or patterns in your personal tax return that warrant further scrutiny. These could include:

• Significant changes in income year-on-year
• Unexplained deductions or reliefs
• Omissions of capital gains or foreign income
• Discrepancies between your tax return and third-party reports (e.g. banks or employers)

These enquiries may be conducted on a random basis or targeted based on risk profiling. While they may initially appear routine, they can rapidly become intrusive and wide-ranging. HMRC may request detailed explanations, supporting documents, and access to bank accounts and business records.

At Axis Solicitors, we prepare and review all correspondence with HMRC, advise on the lawfulness of their requests, and help you provide a consistent, compliant response. Our aim is to resolve enquiries efficiently while protecting you from inadvertent admissions or procedural missteps.

Corporation Tax Disputes

Corporation tax disputes affect limited companies and are often centred on how profits are reported, expenses are claimed, and directors or shareholders are remunerated. HMRC may also challenge intra-group transactions, transfer pricing arrangements, or the treatment of capital versus revenue expenditure.

Typical triggers for corporation tax enquiries include:

• Large one-off deductions
• Loans to directors
• Research and development (R&D) tax relief claimsErrors in deferred tax calculations
• Use of offshore entities or intercompany charges

Our solicitors work closely with forensic accountants and tax specialists to present a coherent defence. We help businesses justify their accounting practices, defend legitimate reliefs, and negotiate with HMRC on disputed liabilities and penalties.

VAT Reviews and Penalties

Value Added Tax (VAT) is an area of high compliance risk, particularly for businesses operating in retail, e-commerce, construction, and import/export sectors. HMRC may initiate a VAT investigation if they detect inconsistencies in returns, excessive refund claims, or signs of non-compliance with registration and invoicing rules.

Common areas of concern include:

• Underreported output VAT
• Overclaimed input tax
• Late registration for VAT
• Errors in EU or international sales reporting
• Improper treatment of zero-rated or exempt supplies

VAT errors can result in penalties of up to 100% of the unpaid tax, along with interest and reputational consequences. HMRC may also investigate suspected fraud, including carousel (MTIC) fraud and missing trader schemes.

We support businesses by reviewing VAT records, identifying risks, correcting errors where necessary, and engaging with HMRC to seek mitigation of penalties under the principles of reasonable care.

PAYE and NIC Investigations

Employers are responsible for deducting and paying Pay As You Earn (PAYE) income tax and National Insurance Contributions (NICs) for their staff. HMRC audits employers to ensure full compliance with these obligations, particularly where:

• Staff are incorrectly treated as contractors
• Benefits-in-kind (e.g. cars, accommodation) are not fully reported
• Termination payments are misclassified
• Share schemes or bonuses are not properly taxed

These investigations can result in large retrospective assessments, along with penalties for failure to operate PAYE correctly. HMRC may also investigate National Minimum Wage compliance and employment status under IR35.

Axis Solicitors provides legal support for employers under review, helping you respond to enquiries, resolve disputes over worker status, and avoid penalties through voluntary disclosure or settlement

Offshore and International Tax Issues

With the increasing globalisation of finance and robust data sharing between tax authorities under agreements such as the Common Reporting Standard (CRS), HMRC has expanded its focus on offshore income and assets.

Individuals with foreign property, bank accounts, trusts, or income-generating investments may face questions from HMRC, particularly if they have not made a timely disclosure.

Examples include:

• Undeclared rental income from overseas property
• Foreign dividends or interest
• Non-disclosed offshore trusts or companies
• Historic use of tax havens

Our solicitors advise on the correct use of the Worldwide Disclosure Facility (WDF), defend clients accused of offshore evasion, and handle enquiries involving complex international tax law.

Tax Avoidance and Schemes

Tax avoidance schemes—although not necessarily illegal—are often scrutinised by HMRC. If you’ve used a marketed tax scheme to reduce your liability, HMRC may issue:

• Accelerated Payment Notices (APNs) requiring payment of disputed tax upfront
• Follower Notices obligating taxpayers to concede if a similar case has failed in court

Such notices must be responded to promptly and carefully. We challenge their legality, lodge appeals where appropriate, and advise on strategies for resolving long-running tax planning disputes.