Thu 16th Apr 2015
It is only natural to feel concerned about an impending investigation by the HRMC. Even if you have full confidence that you have acted in good faith, the process can be daunting. It is important to remember that an investigation is just that, it isn’t an assumption of guilt, from random checks, inconsistencies or inaccurate records there could be a number of reasons they checking out your records in more detail. The most important thing to remember is to stay calm and deal with it head on. It is the quickest and most painless way of finalising the process and getting back to your normal daily activities.
Things to do when being investigated
Get in touch with your accountant – make an appointment to visit and talk through your tax affairs in detail. As experts in the field they are likely to have an idea of the cause of the investigation and be able to put your mind at rest. If it is not instantly clear they can run through a number of factors with you which might highlight the reason for the investigation.
If a mistake has occurred it is likely to be minimal, talk through with your accountant the likely consequences and how to go forward from there.
Be open and honest – trying to hide or disguise any details will cause you, hopefully unnecessary, complications. It is always recommended to give the investigators all the information you have, tell them the steps you have taken and any advice you have been given. Offer a complete story from the start and the inspectors will treat you with the same respect. Try to be elusive and the relationships can become strained making the whole process more difficult.
Review all your tax payments – and we mean all. Investigations could review anywhere up to 20 years of tax payments, so having a review and refresher of all your returns could serve you well and put you on a front foot ready for any questions.
Consider any issues – are there any activities in recent years that have been unusual? Maybe there has been a complicated or unusual payments made or your working habits have changed. Did you for example have fluctuating incomes year on year. There could be many reasons that prompt an investigation, understanding and challenging any inconsistencies first off could save a lot of time.
Know that the truth will out. Best advice is to hold your hands up now if any avoidance activities have occurred. The HRMC will look at every detail and trying to hide details now will be impossible. Understand the past has caught up with you and work with the investigators to put any inconsistencies right.