COP9 HMRC Tax Investigation – An Accountants Approach
COP9, otherwise known as Code of Practice 9 is a HMRC Investigation, which is opened when the HMRC suspect a big loss of VAT / Tax through fraudulent taxpayer behavior. If a COP9 investigation is opened, you would be issued with a CDF, also known as a Contractual Disclosure Facility offer. You are allowed up to 60 days to decline or accept the CDF offer. Please consider that if you receive this document and decide to accept, you gain immunity from prosecution or further investigation.
This is on the condition that you fix any irregularities in regards to fraudulent tax behavior and submit a report. COP9 is by far the most serious type of HMRC investigation carried out by specialist investigators and has become more common with the introduction of the HMRC connect system. This special type of computer system is able to link up billions of pieces of data, which is fed from a stream of sources. This clever system can spot tax irregularities from fraudulent taxpayers. This system costs over £80m to produce, however it is not to be underestimated as it has contributed to a yield of £3 billion of tax revenues. HMRC compliance checks are in place to help avoid tax dodging and prevent mistakes. The HMRC connect system is also used to spot when a citizen has been paying too much tax, which is refundable by the HMRC. A COP8 HMRC investigation is undertaken when there are tax irregularities but serious fraud is not suspected. A COP8 is not to be taken lightly however, as it can lead to a COP9 HMRC investigation if a person does not meet HMRC compliance checks. It is unlikely that the HMRC will disclose what evidence they have on a suspected fraudster.
The Accountancy Solutions – Qualified accountants in Birmingham specialize in COP9 investigations and are able to help such investigations. A qualified accountant would be able to help you go through CFD, deal with HMRC officers and make sure that reduce tax penalties are charged where ever possible. We as professional accountants can attend meetings with the HMRC on your behalf and also prepare disclosure reports. This expert help can result in a fair and final settlement, in which an affordable payment plan is put in place over a reasonable amount of time.
HMRC investigations can be stressful for a taxpayer as the COP9 and COP8 procedures can prove to be lengthy. Specialist accountants at The Accountancy Solutions can provide help if you feel you are being investigated for incorrect reasons. An accountants approach would be to assess the situation and provide the best possible solution. There are a number of times when accountants were able to close HMRC investigations without additional money to pay.
If you accept an offer resulting from a COP9 investigation, you will be given the change to avoid prison and keep penalties down. To accept this offer requires a full disclosure report. This full disclosure document is thorough and will help you avoid prosecution. A poorly structured report can increase your chances of receiving additional penalties. We advise that you hire an accountant to produce a professional disclosure report for you. HMRC procedures can be confusing for the inexperienced and should require expert help. A long drawn investigation can lead to higher penalties, which makes hiring an accountant cost effective. The HMRC are legally allowed to publicly announce a taxpayer that submits an inadequate disclosure report. This would not be good for business and personal relations and can lead to more stress. Hiring a qualified accountant is an option which many chose to avoid additional and unneeded stress. Qualified accountants in Birmingham and surrounding regions are there to help decide how you should respond to a HMRC offer. An accountant is able to attend formal meetings with the HMRC and prepare documents on your behalf. A professional representation of data is a great way to deal with a COP9 HMRC investigation. There have been cases where individuals have faced prosecution by not following HMRC guidelines correctly. If you are issued a COP9 and do not respond in the 60 day time frame, you can face additional penalties and even prison.
HMRC investigations can be daunting without expert help. Most times the HMRC will not release the evidence they have against you at the initial contact. The HMRC connect system is made up from data sources, which means the HMRC have mass information. We suggest keeping a cool head, hiring an expert and being honest with your accountant. This will help your case in the event of a COP9 investigation.
If you have been subject to HMRC investigation, please contact The Accountancy Solutions for a free and no obligation advice on 01216297768.