There are many different reasons why your company could be under investigation, but your options are rather limited once this happens. We’d love to say that it’s a quick and easy process, but the reality is – it often is not and it may feel like it’s dragging out.

HMRC will contact your business or your accountant to notify of the tax investigation. They will ask to arrange a visit to your home, business or adviser’s office, they may also suggest you come to see them. You can be accompanied by your accountant and legal adviser during such meetings to offer their support.

Why your company?

This is the very first question you will likely ask. You may have simply been randomly selected for a check, this does occasionally happen.

More often than that, the reason behind an audit could be repeatedly filling tax returns with errors. The more reasons you give them to believe that you are not capable of filling the details correctly, the more likely they will want to investigate your full accounts further to see whether the mistakes are deliberate or mean a serious underpayment.

HMRC will often also act upon tip-offs they may receive about any suspicious activities.

There are many other triggers that once spotted, may result in an investigation, such as signs of avoidance schemes and omitting income. The more honest and thorough you are – the less there is to worry about and that’s the bottom line.

This is where having an accountant really helps. It shows HMRC that you are happy to share your financial details with a professional who will ensure all is filled correctly.

Although there is no guarantee that your company will never be investigated, you can minimise your chances.

What if you don’t agree?

You can apply for Alternative Dispute Resolution (ADR) at any time if you don’t agree with HMRC’s decision or what they’re checking. You’ll be assigned an HMRC mediator who will work with you and the HMRC officer dealing with your case. ADR can be used before and after HMRC has issued a decision that can be appealed against and you can apply for one at any stage of the process.

Any decision reached at the end of investigation can be appealed.

Audits can put an enormous strain on any business, that’s why we believe minimising the risk and making sure that your accounts are in order is a much better option than “chancing it” yourself. If you’d like to find out more about our services, please call our team on 01752 895648.