HM Revenue & Customs Investigations and Disputes

Revenue Authority Investigations and Disputes

Many members don’t realize that AOP membership gives them automatic cover in respect of VAT disputes and Tax investigations through Abbey Tax Protection.  Check with your insurers to make certain that you are not paying them unnecessarily for this service – it could save you a whole load of money.

The average settlement made by taxpayers with HM Revenue & Customs following a business tax investigation is £11,000 including tax, interest and penalties.  In addition there are often considerable professional fees incurred.  This service will dramatically reduce the potential duties and without any professional charges.

You are covered for the following:

• Self Assessment Full Enquiry

This starts when the Inspector of Taxes advises a sole proprietor or partnership that they want to examine all the business books and records which were used as a basis for calculating the taxable profits.  This letter will be accompanied by a Notice under Section9A or Section 12AC of the Taxes Management Act 1970.  

• Corporation tax Full Enquiry

Corporation Tax Full Enquiries are now a threat for any company with an accounting period commencing on or after 1st July 1998.  These investigations will also involve an examination of all the business books and records together with the issue of a notice under para 24 Schedule 18 Finance Act 1998.

• Employer Compliance (P11D & PAYE)

These investigations start following a visit from HM Revenue & Customs when a letter of dissatisfaction is sent which sets out additional liabilities.  The service does not extend to representation by an Abbey Tax consultant at the initial visit.

• HM Revenue & Customs VAT Disputes

This is the examination which takes place following a control visit by HM Revenue & Customs where the quantum of VAT duties is disputed.  The service does not extend to representation by an Abbey Tax consultant at the initial control visit.

Terms and Conditions

Whilst the service is designed to provide representation for most eventualities, there is a duty of care imposed upon members, for example if returns are not submitted to the revenue authorities within the statutory time limits then this will prevent Abbey Tax from providing representation.
 
Other important conditions and exclusions which members should be aware of are as follows:-

• You must notify the AOP immediately you become aware of a revenue authority dispute or investigation.  If you fail to do so within 6 months this will exclude your claim
• You must disclose all relevant information to Abbey Tax when requested.
• Disputes and investigations already in progress at the time a new member joins the AOP will not qualify for representation.
• Investigations conducted by the Special Compliance Office and the Investigations Division of HM Revenue & Customs or under Section 60 of the VAT Act 1994 are not eligible for representation; these cases are where the revenue authorities allege fraudulent conduct.  Abbey Tax Protection are, however, able to handle these cases on a fee paying consultancy basis.
• Representation extends to HM Revenue & Customs Commissioners Hearings and VAT Tribunals but not for appeals beyond these bodies.
• There must be a reasonable prospect of reducing the alleged arrears of additional duties for representation to be available.
• The service does not reimburse any taxes, interest, penalties or fines which may be incurred by the member.  Accountancy fees are not reimbursable unless incurred at the express request of Abbey Tax.

If you have a revenue authority dispute or investigation please contact Alan Lester, AOP Head of Finance, immediately on 020-77 87 11 15. Alternatively contact Abbey Tax direct on 0870 607 7000.

Please note. The AOP policy cover does not extend to “Aspect enquiries”, which look at one or two areas of the Self Assessment Return and do not entail a review of the business or business records. These enquiries are generally dealt with relatively quickly and it would be unusual for a meeting to be required as HM Revenue & Customs do not carry out a detailed examination of the business results and it is the business that the AOP Policy is designed to protect. Secondly, most aspect enquiries are settled relatively quickly and generally relate to specific figures contained in the business accounts. Consequently, it would be necessary to obtain the specific information from your accountant who may charge for the extraction of information from your files.

The AOP reviews this service each year to decide whether or not to renew it. This cover for members currently runs until 31 December 2008. It will next be reviewed in the autumn of 2008 with regard to renewing the service for 2009.