HMRC investigations are on the rise – in fact, HMRC opened 102,000 tax investigations in the first quarter of 2021, which was 36% up on the 75,000 opened in the final quarter of 2020. HMRC in Newcastle have recently hired 20 new members of staff thus increasing the number of investigations taking place.
HMRC can investigate your tax affairs at any point to make sure you’re paying the right amount of tax, both at present and historically. If your business is selected, you’ll receive an official HMRC investigation letter or phone call where they’ll tell you what they want to look at, such as:
- your Self-Assessment tax return for a given year
- your Company Tax Return
- your PAYE records and returns if you’re an employer
- your VAT returns and records if you’re VAT-registered
- any Coronavirus Job Retention Scheme and SEISS payment claims
Earlier this year, Chancellor Rishi Sunak announced £100m for a new Taxpayer Protection Taskforce to crackdown on fraudsters who dishonestly exploited the Government’s Covid financial support schemes, including the Job Retention Scheme (JRS) and the Self Employment Income Support Scheme (SEISS). These schemes have been a saving grace for many of our clients, but there is no doubt that nationally there will have been a mixture of misuse and mistakes since their introduction. Therefore, if you are aware of any errors in any furlough scheme or SEISS claims you have made, these should be disclosed to HMRC to prevent any potential penalties being filed from an investigation being carried out.
If you are selected for investigation, you must comply by law. Tax investigations can be incredibly time consuming and can be stressful; they can take months to conclude. We can guide you through the investigation process & compile any information requests HMRC have.
You may be wondering who covers the cost of a tax investigation. The related work, as you can imagine, can be lengthy and as a result costly. TyneRede Accountancy offers clients Tax Investigation Protection which protects you against any professional costs arising as a result of HMRC opening an investigation into your affairs.
Every taxpayer leaves themselves open to HMRC investigations which is why we strongly advise that clients take up the fee protection service. With this service, you will have peace of mind knowing that the people you trust will provide you with the best support if you are chosen by HMRC for a tax investigation. We will work on the case for as long as required to ensure you get the best possible outcome, without you worrying about the cost, and saving you potentially thousands of pounds. That way you can continue to dedicate your time to the running of your business.
Below we have put together a couple of frequently asked questions:
What is Tax Investigation Protection?
It is a service which protects our clients who are selected for a tax investigation by HMRC. For a small annual fee, we will respond to HMRC on your behalf and provide you with full representation, prepare your case and defend your case fully and handle all correspondence and meetings with the tax inspector therefore giving you peace of mind that all professional representational costs are covered.
What does Tax Investigation Protection cover?
The tax investigation service will cover our fees if HMRC investigate you. HMRC can investigate you even if your tax return and business records are accurate and no errors have been found. The fees that occur with these investigations can be thousands of pounds; by taking out Tax Investigation insurance with TyneRede you won’t suffer these fees. Sadly, we can’t take away the stress of being under investigation, but we can provide you with the best possible support and advice without you having to worry about the cost.
What is not covered by the service?
The protection service does not cover routine work such as filing your tax return and it also doesn’t cover any amounts of tax that has been underpaid, interest or penalties that may be incur because of an investigation.
How much will Tax Investigation Protection cost me?
Please contact us and we will be able to provide you with a personalised quote.
If you would like more information about our fee protection service, please get in touch with us on 01434 220918 or email admin@tynredeaccountancy.com.
