HMRC Investigations

Dreading the thought of being investigated by HMRC?


Around 1 in 10 small businesses are under investigation at any given time and HMRC’s main aim is to prevent non-compliance from occurring in the first place.

Here at Wells Advisory we can help! We can offer support and advice for you if you are currently being investigated or if you have concerns about the prospect of being investigated.

So, here is all you need to know in the event that your business does come under investigation in order to make the process a little easier.     


What happens during an investigation process?

HMRC will contact you, to inquire about your accounts and tax position and you’ll need to provide them with the relevant information according to their requirements.

The investigation could come under 1 of 3 levels:

  • Random: HMRC has chosen your business at random for an investigation
  • Aspect: the investigation is concerned with a particular part of your accounts
  • Full: the enquiry involves a comprehensive review of your records.

Depending on what HMRC finds, they’ll decide if you have underpaid tax, overpaid tax or, in the most serious cases, if they believe you have committed fraud.


Wells Advisory’s top tips for if you ever come under investigation:

  • Stay calm – There are a number of reasons you could face an investigation, and it doesn’t necessarily mean you’ve done something wrong.

While it’s important to act quickly and within deadlines, it’s best to take a calm approach, without rushing your communications with HMRC.

  • Seek support or advice – Facing a tax investigation alone can make the process even more stressful, so it’s better to go into it with the help of an expert.

It’s important to have someone on your side who understands the complexities of tax, and can take on some of the pressure.

You can ask us about any correspondence you receive from HMRC, and we’re happy to liaise with them on your behalf.

  • Be honest and cooperative – Being as helpful and open as possible during the investigation will stand you in good stead later on.

Above all, make sure you answer questions truthfully, and be prepared to back up what you’re saying with relevant records.

  • Inform HMRC of any mistakes – If you’re aware you’ve made a mistake with your taxes, it’s best to tell HMRC as soon as possible, rather than wait for them to discover it.

Attempting to cover mistakes up could result in a higher penalty or even criminal proceedings.


And finally….


…..avoid an investigation all together!


While there’s nothing you can do about random investigations, there are a few ways to reduce the likelihood of attracting HMRC’s attention to begin with.

The easiest way to do this is to maintain accurate records, so your tax returns can be filed correctly and any unusual activity can be explained.

Staying up to date with your tax bills and paying them on time can also help to keep you off HMRC’s radar.


Speak to the team at Wells Advisory if you are under HMRC investigation.


Call us now on 01892 507288