Tax Investigation Service

The Finance Act 2008 granted HM Revenue & Customs (HMRC) a new raft of investigative and challenging powers.

These powers include the right:

• To enter premises used by traders and to inspect documents.
• To make unannounced visits.
• Application for a warrant to search extended to search for documents required to accompany the goods.
• Information from those who may hold relevant information from other parties such as banks.

As a safeguard, a formal notice, pre-authorised by a tribunal would be required.
HMRC are acquiring additional resources into the collection of Tax and VAT and enquiries into tax returns are on the increase.  All taxpayers of either businesses or private individuals are now much more likely than ever before to face an enquiry. The costs associated from an enquiry, from both a financial point of view and well as your precious time and energy can be significant and disputes can drag on for many months - even if no additional tax is found to be due.

Tax Investigation insurance offers a facility for individuals to obtain protection against the fees of your tax agent/accountant to represent you. To validate the insurance, the agent must prepare your personal or company tax return, the tax return must not generally be filed to HMRC later than the appropriate deadline and the premium must be paid before an investigation arises.

The insurance will generally cover items such as:

• A Full Enquiry of the tax return. It will involve a comprehensive review by HMRC of all books and records underlying the entries made on the return.
• Aspect Enquiry. An enquiry into one or more aspects of the tax return.
• PAYE/VAT Compliance Visit Cover – This will include Business Records Checks.
• VAT Disputes PAYE/NIC Disputes
• IR35 Disputes
• A Business Inspection
• Code of Practice 8
• Application for a Judicial
• Interventions Cover

If you wish to know more about HMRC’s powers and the insurance cover please contact us on 01582 766677 or at admin@hicks.co.uk