HM Revenue and Customs Solicitor

HM Revenue and Customs are one of the most powerful bodies investigating crime and tax evasion.
They investigate matters such as:
  • Missing Trader Intra Community (MTIC) fraud;
  • Money Laundering;
  • False Accounting;
  • Cheating the Revenue.

Tax investigations.

If you are aware that you are the subject of a tax investigation you should contact us at your earliest opportunity for expert advice. Tax investigations are complex and expert advice is essential.

Solicitor or Accountant?

If you are considering instructing an Accountant or a Solicitor, you should be aware that information you provide to your Solicitor enjoys a special status called legal privilege. Your Accountant cannot provide this protection, although they may be able to gain it if they are instructed by a Solicitor. If there is to be an assessment of the Tax due and a Report prepared about your Tax affairs, we can instruct an Accountant on your behalf.

How will I know if the Revenue will consider bringing criminal charges against me?

The following are indicative factors of an investigation being treated as a criminal investigation:

  • You are invited to attend a formal interview;
  • The Investigating Officer is from the SCO (Special Compliance Office);
  • The word "caution" or the words "you do not have to say anything…" are used;
  • If you are a professional, e.g. a Solicitor or an Accountant;
  • If you have been involved in creating false documents;
  • If there is an allegation of a long term evasion of tax;
  • The Investigating Officers have obtained a warrant to search your premises;
  • It is alleged that you have mislead HM Revenue and Customs.

Civil Settlement

It is often possible to arrange to settle Tax debts without the involvement of the Criminal Courts in a civil settlement. If Tax is settled on a civil basis, in addition to the Tax due, there will be interest on the outstanding Tax and a penalty. Penalties are negotiable and there are discounts for mitigating circumstances such as full co-operation.

Penalties for incorrect returns

A new single penalty regime has been introduced and applies to tax returns due on or after 1 April 2009. The new regime applies returns for VAT, PAYE, National Insurance contributions, Capital Gains Tax, Income Tax, Corporation Tax and the Construction Industry Scheme and aims to encourage the accurate filing of returns. Errors which are made notwithstanding the person having taken 'reasonable care' will not be charged a penalty under the new regime.

The penalties charged are calculated as a percentage of the tax due, although the actual percentage will vary according to the behaviour that gave rise to the error. Less serious behaviour will attract a smaller penalty.

Criminal investigation powers for HM Revenue and Customs

Historically the Inland Revenue did not have the same powers of arrest that Customs and Excise had enjoyed for many years. Therefore, under the old law, if arrests or warrants were required the Revenue had to involve a police constable.

However, the Finance Act 2007 changed that by bringing in arrest powers for all officers of HM Revenue and Customs, based on the provisions of the Police and Criminal Evidence Act. This has lead to an increase in the number of arrests by HM Revenue and Customs.

These powers can be used only for HMRC offences and are not general powers of arrest. Furthermore, as with all of HMRC’s criminal investigation powers, arrests can be made only by authorised officers who have been appropriately trained.

Tax amnesty

The Government announced in its April Budget that a second offshore disclosure facility would commence later in the year. The New Disclosure Opportunity, as it is to be called, will begin in Autumn 2009 and run until March 2010 and will give offshore account holders ‘one final opportunity to disclose and put their affairs in order’. Although there is always the chance that further opportunities will arise, and that this will not be the final one, nevertheless taxpayers are advised to regard this as the final one and regularise their tax affairs whilst the opportunity exists. The alternative is to face the prospect of significantly higher financial penalties for non-disclosure or, even worse, a criminal prosecution.

The last Offshore Disclosure Facility took place during 2007 and encouraged those with undeclared income arising from offshore accounts to declare it to HM Revenue & Customs. In return for making a full disclosure and paying tax liabilities and interest due, a fixed penalty of 10% of the tax due was charged.

For more information see a separate article on this web site entitled New Disclosure Opportunity.

How can we help?

  • Richard Nelson Solicitors can assist in negotiating the repayment of any undisclosed tax liability with Revenue and Customs.
  • We can also attend any inspections, searches or interviews.

Contact Us

Please contact us with any queries relating to HM Revenue and Customs