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HMRC Tax Investigation Solicitors

An HMRC investigation is not a routine audit. It is a formal legal process with serious consequences — including tax assessments, penalties, interest, and in fraud cases, criminal prosecution. The information you provide from day one shapes the outcome.

HMRC conducts tax investigations under various powers — the self-assessment enquiry (s.9A TMA 1970), the civil investigation of fraud (Code of Practice 8), and the most serious civil fraud investigation (Code of Practice 9), under which the taxpayer is given the opportunity to make a full disclosure in exchange for immunity from criminal prosecution. Each type of investigation requires a different legal strategy. A solicitor will advise on the nature of the investigation, the scope of HMRC's information-gathering powers, the information that must and need not be provided, and the most effective route to resolving the investigation with the minimum tax and penalty exposure.

COP 8 & COP 9 investigations S.9A enquiries & information notices Disclosure facilities & penalty reduction Free initial consultation

HMRC Investigation Types & Legal Issues

HMRC tax investigations — the different types of investigation and what legal advice is required at each stage.

The type of HMRC investigation determines the powers HMRC has, the information the taxpayer must provide, and the legal strategy most likely to achieve an early and cost-effective resolution. A solicitor will assess the investigation and advise from the first contact.

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Self-assessment enquiry (s.9A TMA 1970)

HMRC can open a formal enquiry into any self-assessment return within 12 months of the filing date. The enquiry opens with a notice specifying the period under investigation. HMRC can then request information and documents by issuing an information notice (Schedule 36 Finance Act 2008). A solicitor will assess the scope of the enquiry, advise on what information is required to be provided, and respond strategically — minimising the information provided and the tax and penalty exposure. Where the enquiry is taking too long, a solicitor can apply to the First-tier Tribunal for a closure notice, requiring HMRC to bring the enquiry to a conclusion within a specified period.

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Code of Practice 8 — civil investigation of suspected fraud

A COP 8 investigation is HMRC's civil investigation into cases where HMRC suspects serious tax fraud or avoidance but has not yet decided whether criminal prosecution is warranted. COP 8 is conducted by HMRC's Fraud Investigation Service. The taxpayer is interviewed under caution, and the interview record is used in any subsequent assessment or prosecution. A solicitor will attend all interviews, advise on whether the taxpayer is required to answer specific questions, manage the disclosure process, and negotiate the tax and penalty settlement where the investigation concludes without criminal prosecution. COP 8 investigations can result in significant assessments covering many years — a solicitor's early involvement is essential to limit the exposure.

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Code of Practice 9 — Contractual Disclosure Facility

A COP 9 investigation is HMRC's most serious civil investigation — issued where HMRC has formed a reasonable suspicion of fraud. The taxpayer is offered the Contractual Disclosure Facility (CDF): make a complete disclosure of all deliberate tax fraud and HMRC will not pursue criminal prosecution. Rejecting the CDF (by denying fraud) removes the immunity — HMRC is free to investigate and, if the evidence supports it, prosecute. Making a CDF disclosure that is incomplete is treated as a criminal matter. A solicitor is essential from the moment the COP 9 notice arrives — the decision whether to accept or reject the CDF, and the management of any disclosure made, are high-stakes legal decisions with criminal prosecution consequences.

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Worldwide Disclosure Facility and offshore tax

The Worldwide Disclosure Facility (WDF) is HMRC's current disclosure opportunity for taxpayers with offshore income or assets not previously reported — bank accounts, rental income from overseas property, offshore investments, and offshore trusts. Making a WDF disclosure before HMRC identifies the undeclared income or assets reduces the penalty rate significantly. Failure to disclose, and failure to correct (FTC) penalties, can reach 200% of the unpaid tax for the most serious offshore non-compliance. A solicitor will advise on the extent of the disclosure required, prepare and submit the WDF disclosure, and negotiate the penalty with HMRC — minimising the financial cost of regularising the position.

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Schedule 36 information notices — challenging HMRC's requests

HMRC has wide-ranging powers to require the production of documents and information under Schedule 36 Finance Act 2008. An information notice can require the taxpayer to produce documents and provide information reasonably required for checking the tax position. However, HMRC's information-gathering powers have limits — certain documents are legally privileged (communications with a solicitor), certain information is protected (personal data about third parties), and HMRC cannot request information that is not "reasonably required". A solicitor will assess each Schedule 36 notice, advise on which requests are within HMRC's powers, challenge notices that exceed those powers by appeal to the First-tier Tribunal, and manage the response to ensure compliance without over-disclosure.

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Tax settlement negotiations — minimising penalties

Most HMRC investigations conclude with a civil settlement — a negotiated agreement on the additional tax due and the penalty. The penalty rate depends on the behaviour (reasonable care, careless, deliberate, deliberate and concealed), the extent of the disclosure (prompted or unprompted), and the quality of the disclosure. For prompted disclosure of deliberate behaviour, the penalty range is 35–70% of the unpaid tax. For unprompted disclosure of the same, it is 20–70%. For deliberate and concealed behaviour, the ranges are higher. A solicitor will present the most compelling case for the lowest penalty, demonstrate the quality of the taxpayer's cooperation, and negotiate the settlement to the most favourable outcome achievable.

How It Works

The information you provide to HMRC in the first response to an investigation determines the scope of what follows. Getting that response right — with legal advice — is the most important step in managing the outcome.

A solicitor will manage every stage of the HMRC investigation — from the first enquiry notice through to settlement or tribunal — advising on what must be disclosed, what should not be volunteered, and how to present the taxpayer's position in the most favourable light.

Submit Your Request
1

Tell us about the investigation and the tax involved

Describe the nature of the HMRC contact — enquiry notice, information notice, COP 8 or COP 9 letter — the tax years involved, and the tax type.

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Solicitor assesses the investigation and advises on strategy

A tax investigation solicitor assesses the type of investigation, HMRC's likely focus, and the best legal strategy to achieve the minimum tax and penalty outcome.

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Free initial consultation

You receive clear advice on the investigation and the most effective legal response — at no cost and no obligation.

Free Initial Consultation

An HMRC investigation handled without legal advice almost always results in a worse outcome — more tax, higher penalties, and a longer investigation — than one managed by a specialist solicitor from the outset.

Get specialist HMRC investigation advice — and ensure the taxpayer's position is managed strategically from the first contact to the final settlement.

Get HMRC Investigation Advice

Common Questions

HMRC tax investigations — what people ask us.

Can HMRC investigate tax returns going back more than 4 years?

Yes — in certain circumstances. Where a return was filed with careless inaccuracies, HMRC can go back 6 years. Where the inaccuracy was deliberate, HMRC can go back 20 years. For offshore matters, the time limits are extended — HMRC can assess going back 12 years where there was a loss of tax involving an offshore matter, even where the non-compliance was not deliberate. For fraud, there is no time limit — HMRC can assess for any year. A solicitor will advise on the applicable time limits for the specific tax and behaviour type — ensuring HMRC does not assess beyond its legal powers.

HMRC has issued me a Code of Practice 9 notice. Should I accept the CDF?

This is one of the most consequential legal decisions a taxpayer will face — and it must be taken with specialist legal advice. Accepting the CDF commits the taxpayer to making a complete and accurate disclosure of all deliberate tax fraud. An incomplete CDF disclosure is treated as a criminal matter. Rejecting the CDF removes the immunity from prosecution and invites HMRC to investigate without the co-operation of the taxpayer. A solicitor will assess the taxpayer's position, the strength of HMRC's evidence, and the likely consequences of accepting or rejecting the CDF — and advise on the decision that minimises the risk of criminal prosecution and the financial cost of the settlement.

Do I have to answer all of HMRC's questions during an investigation?

No — the taxpayer has a right to remain silent in a criminal investigation (caution applies). In a civil investigation, HMRC can compel the production of documents and information under Schedule 36 Finance Act 2008, but legal professional privilege protects communications between a taxpayer and their solicitor from disclosure. HMRC cannot require the production of privileged documents. A solicitor will advise on what the taxpayer is legally required to provide and what is protected — and manage the response to information notices within those limits, challenging any notices that exceed HMRC's statutory powers.

How long does an HMRC tax investigation take?

A routine self-assessment enquiry can be resolved in 3–12 months if the issues are straightforward and the taxpayer's records are complete. A COP 8 investigation typically takes 12–36 months. A COP 9 investigation, including the preparation of a CDF disclosure, assessment, and penalty negotiation, can take 2–5 years. The length of the investigation depends on the complexity of the tax issues, the volume of documentation, the taxpayer's co-operation, and whether the investigation proceeds to the tax tribunal. A solicitor will manage the process to achieve resolution as efficiently as possible — including applications for a closure notice where HMRC is taking unreasonably long to close a self-assessment enquiry.

What is a tax settlement and how is the penalty calculated?

A civil tax settlement is a negotiated agreement between HMRC and the taxpayer — covering the additional tax due, interest (which accrues from the due date of the original return), and the penalty. The penalty rate is determined by: the type of behaviour (innocent error, careless, deliberate, deliberate and concealed); whether the disclosure was prompted (HMRC had already identified the issue) or unprompted (the taxpayer disclosed before HMRC identified it); and the quality of the disclosure (telling, helping, and giving access). Unprompted disclosure of careless error carries the minimum penalty — sometimes nil. Deliberate and concealed behaviour with a prompted disclosure carries the maximum. A solicitor will negotiate the penalty, presenting the most compelling case for reduction and ensuring the quality of disclosure is presented to HMRC in the most favourable way.

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