Specialist Investigations and Civil Investigation of Fraud Offices

The Specialist Investigations (SI) and Civil Investigations of Fraud (CIF) offices of HMRC investigate the most serious cases of tax avoidance and evasion. SI operates under two published Codes of Practice: COP 8 in cases other than suspected fraud and COP9 in cases of suspected serious fraud. CIF only operates under COP 9.

Their usual objective is to reach a civil monetary settlement. Where the investigation is under COP 9, the client will be given the opportunity to make a full and complete disclosure and in return will be given considerable protection from prosecution. If false statements are made or false documents are provided under COP9, the investigation may proceed to criminal prosecution.

COP9 requires a disclosure report to be completed. The report demonstrating cooperation and disclosing all irregularities can cover twenty years. This will involve a considerable amount of work within a tight timeframe, normally six months. Specialist help will be essential to ensure that the report is comprehensive and identifies all relevant issues, including those which are to the client’s advantage.

A new penalty regime took effect on 1 April 2008 and applies to tax returns due to be filed on or after 1 April 2008. The old penalty regime will continue to apply to tax returns that were due to be filed before 1 April 2008. Therefore, where a number of years are concerned, different penalties may apply to different years. The new penalty regime sets minimum levels of penalty depending on the action that gave rise to the penalty. In many cases this will result in higher penalties than would have been the case previously. However, under both the old and new regimes, penalties can be considerably reduced by cooperating and making a full disclosure within an agreed timescale.

The budget on 22 April 2009 announced a new policy by HMRC to publish the names of deliberate tax defaulters. Names will not be published of those who make an unprompted disclosure or a full disclosure within the required time. It is very important you have a professional adviser working for you so that your anonymity is protected.

Haines Watts Tax Investigation Support and Resolution Team have prepared many disclosure reports of behalf of clients to SI and to CIF. We have the experience, skill and structure to produce a top quality report at a sensible price.