Tax investigation

Being the subject of a tax investigation can be hugely stressful for you, even if you have nothing to hide. And the time and resource needed to support HMRC’s requests can also prove costly. Our specialist tax advisors can ensure that you have insurance cover in place to take care of related fees.

HM Revenue and Customs (HMRC) no longer need a reason for opening an enquiry into your business or personal affairs, meaning that everyone is at risk of a tax investigation and a proportion of businesses are investigated at random.

Under self-assessment, every sole trader, partnership and limited company is at risk of tax investigation, while all large employers are likely to have a PAYE or NIC audit visit every 5 years which may lead to an investigation into expenses payments, P11D returns and the status of subcontractors. All VAT registered businesses are also at risk with 46% of control visits resulting in additional VAT being payable.

If you’re one of the unfortunate businesses selected for a tax investigation, HMRC can go back through at least four years’ worth of accounts and tax returns and your accountant will be required to get heavily involved. And an average in-depth accounts investigation can take 18 months and accountancy fees for dealing with the investigation could exceed £5,000 in costs that your business had not budgeted for.

Protecting your business from tax investigations

In addition to supporting you if your business is selected for a tax investigation, we can also provide a specialist tax investigation service which is backed up by an insurance policy that the Forrester Boyd practice has taken out with Abbey Tax Protection. We are able to make a claim under the policy in respect of fees incurred on behalf of a client who has subscribed to the service for:

  • business tax investigations
  • employer compliance disputes
  • IR35 disputes
  • VAT disputes.

Download our tax investigation leaflet to find out more and to understand your potential exposure.

For more information please do not hesitate to contact us.