Code of Practice 9 investigations

If you have been contacted by HMRC’s Fraud Investigations Service or FIS, it is likely that you are suspected of serious tax avoidance or evasion.

The investigation will be under the following Codes of Practice (COP):

  • Code of Practice 8, which relates to bespoke tax avoidance schemes where investigation for tax fraud is not seen as necessary or appropriate
  • Code of Practice 9, where tax fraud or dishonesty is suspected and (usually) a large amount of tax is at stake

The investigation could relate to income tax, capital gains tax, VAT, SDLT, inheritance tax or one or more of these, plus any of the other taxes administered by HMRC.

Either way, if HMRC suspect that you have committed tax fraud, you should not think that they can be fobbed off or avoided.

Even if you believe that HMRC are mistaken in their suspicion, and there is a simple or an honest explanation, it is essential that you deal with the investigation seriously and engage with HMRC even if only to deny any wrongdoing.

Ideally, you should appoint an experienced lawyer to represent you with HMRC. This will ensure that you have someone to act as a buffer between you and HMRC throughout what can be a very worrying and anxiety-inducing experience. It will also ensure that you maximise your chances of resolving the investigation without serious consequences for you – such as prosecution, penalties for deliberate behaviour and publication of your name as a tax defaulter.

Appointing a direct access barrister from the beginning, instead of a solicitor, a non-legally qualified tax accountant or an ex-HMRC investigator can save you paying out fees for two or even three sets of professional advisers.

Here’s why:

If matters proceed to an interview under caution, or you are arrested or criminal proceedings are begun, you will then need to brief a lawyer – incurring additional professional fees bringing them up to speed on what can often be a lot of complex financial detail.

Appointing a direct access barrister instead of a solicitor from the start can also avoid the need for a solicitor to brief a barrister to represent you in court – a further considerable saving in professional fees. The barrister can also liaise with your accountant, if you have one, or can recommend one for you.

If you’re facing a COP9 investigation, please seek specialist advice.

Patrick Cannon is highly experienced in COP9 HMRC investigations and in acting for clients subject to such investigations, including corresponding with and meeting HMRC investigators with clients and defending clients in criminal tax proceedings.

Get in touch with Patrick Cannon today.

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