In line with the law, HMRC are entitled to investigate personal tax returns under Section 9A of the tax management act, with notice being issued within twelve months of the return under investigation being filed.
Your written notice of the investigation into your tax return will quote Section 9A, with HMRC themselves indicating that they would either like to undertake a relatively routine enquiry, or that they would like to investigate very specific points regarding your return.
Either way, if during the course of their investigation HMRC uncover more serious tax issues, they will be quick to take it upon themselves to conduct a weightier investigation.
How Tax Enquiries are Selected
Tax returns are selected both randomly and according to risk.
Though most enquiries fall into this latter column, with HMRC under the impression that there may be a significant tax risk, or a simple suspicion that something may be amiss, your return may have been randomly selected for investigation even if everything, on the surface, appears to be in order, so don’t become unnecessarily worried just yet.
As previously mentioned, HMRC will likely let you know whether they intend on undergoing a full investigation into your tax return or whether they are specifically interested in a number of points. In both instances, they will not let you know whether your return was selected randomly or according to risk.
Serious Investigations: COP 8 and COP 9
Regardless of how your return was selected, if during the course of their investigation HMRC uncover any serious tax issues (or any more serious tax issues), they will be quick to take it upon themselves to conduct a weightier investigation.
In this instance, if HMRC suspect there may be evidence to believe that tax fraud or avoidance has taken place, they may opt to investigate your return further by opening a Code of Practice 9 (COP 9) tax investigation for potential tax fraud, or a Code of Practice 8 (COP 8) investigation for tax avoidance, both of which will, clearly, be detrimental to the daily running of your business, as well as your personal peace of mind.
If you have received Section 9A Tax Enquiries
Having to undergo an investigation into your personal tax return is both stressful and time-consuming, especially when placed on top of the everyday running of your business.
To avoid these hassles as much as possible, if you’ve recently received a notice from HMRC regarding a tax return enquiry please do contact us immediately on 020 8780 2349 or get in touch with us via our contact page to speak with a professional to discuss the Section 9A tax.
This blog is a general summary. It should not replace professional advice tailored to your specific circumstance.