HMRC announced at the start of November that two-thirds of the 800 largest UK businesses are under enquiry. Jennie Granger, director general of enforcement and compliance at HMRC, told a conference:
“We are enquiring into two out of three of the largest corporations operating in the UK – many of which are multinationals.”
While the costs associated with HMRC investigations don’t often dent the balance sheets of large companies, it can be a different story for small business owners. A lengthy investigation by the authorities can spell financial trouble for a small firm.
Invoking the wrath of the revenue
The revenue has far-reaching powers of investigation. Although this can begin with a seemingly innocuous letter asking for clarification on specific points, things can easily escalate if the matter is not dealt with satisfactorily (in HMRC’s eyes at least). Her Majesty’s Revenue and Customs have the ability to:
- open full and aspect enquiries into corporation and income tax self-assessment returns
- obtain a business’s documents and information
- obtain the business owner’s personal information
- inspect a business’s assets and premises through notified and unexpected visits
- seize assets and obtain arrest warrants as part of a criminal investigation.
Depending on the business, investigations take an average 16 months to complete. Without the appropriate insurance, it can cost up to £5,000 to have an accountant handle the investigation for you.
Our cover reduces the cost of investigation
PKB offers fee protection insurance to help business owners protect against the cost of HMRC investigations. While we can’t prevent HMRC from investigating your company, we can provide you with a defence. For a yearly fee, our insurance service provides cover for:
- record checks
- defence costs
- aspect enquires.
You also get unlimited access to our comprehensive business legal helpline.