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Enquiries · Investigations · Penalty Appeals

HMRC Compliance &
Investigations

Expert representation from the moment HMRC makes contact. We take over all correspondence, protect your position, and work to achieve the best possible outcome — whatever the nature of the enquiry.

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HMRC compliance document review — DKAT Accountants
£3,000+
Average penalty for undisclosed offshore income
18 months
Typical duration of a full HMRC investigation
First letter
When you should contact us — immediately
FCCA
Qualified — fully regulated and insured
Overview

HMRC has more power than most people realise

HMRC has extensive and growing powers to investigate individuals and businesses. It receives data from hundreds of third-party sources — banks, letting platforms, Companies House, the Land Registry, social media and more — and uses sophisticated risk profiling to identify returns that don't match its expectations. If your return is selected, you will receive a formal enquiry notice.

The moment you receive that letter, the decisions you make matter enormously. What you say, what you disclose, and how quickly you respond can significantly affect the outcome — including the level of any penalties, whether HMRC pursues further years, and whether the matter remains civil or becomes criminal.

At DKAT, we have extensive experience handling HMRC enquiries and investigations across self-assessment, corporation tax, VAT, and PAYE. We take control of the process on your behalf, ensure HMRC operates within its legal powers, make voluntary disclosures where appropriate, and negotiate the best possible settlement — minimising both the financial and reputational impact on you and your business.

Don't wait — contact us today

  • The earlier you involve us, the better your outcome
  • Early voluntary disclosure can significantly reduce penalty exposure
  • HMRC can open enquiries up to 20 years in serious cases
  • We maintain strict client confidentiality throughout
  • All advice is given in writing for your protection
  • We handle everything — you don't deal with HMRC directly
98%
Successful resolutions
24hrs
Initial case assessment
Who This Service Is For

We support individuals and businesses at every level

👤
Individuals with Enquiry Notices
If you've received a letter opening an enquiry into your personal tax return, contact us immediately. Early professional representation makes a significant difference to the outcome.
🏢
Businesses under Investigation
Corporation tax, VAT and PAYE compliance checks affect businesses of every size. We represent sole traders, partnerships, and limited companies.
🏠
Landlords
Let Property Campaign disclosures, undeclared rental income, and capital gains on property disposals are among the most common subjects of current HMRC investigations.
🌍
Offshore Assets
HMRC's Connect system now receives automatic information about overseas accounts and assets. If you have undisclosed offshore income, a voluntary disclosure is far better than waiting to be discovered.
💼
Directors & Shareholders
HMRC regularly investigates director loan accounts, dividend payments, and the employment status of contractors — particularly in the context of IR35.
⚠️
Late Filers & Penalty Cases
If you've accumulated penalties for late or non-filing, we can make representations on your behalf, explore reasonable excuse appeals, and negotiate time-to-pay arrangements.
What We Handle

Every type of HMRC enquiry and investigation

HMRC uses several different types of enquiry depending on the nature and scope of the suspected issue. We have experience handling all of them.

01
Section 9A Self-Assessment Enquiries
The most common form of HMRC investigation, opened within 12 months of your return filing date. These range from 'aspect enquiries' (covering one specific point) to full investigations covering all income and expenses.
02
Corporation Tax Investigations
HMRC may enquire into a company's CT600, directors' remuneration, dividend policy, related party transactions, or the use of reliefs such as R&D credits. We represent the company and its directors throughout.
03
VAT Control Visits and Written Enquiries
HMRC's VAT compliance team can visit your premises or raise written queries about your VAT returns. We prepare your records for inspection and represent you throughout the process.
04
PAYE Compliance Reviews
Employer compliance officers review PAYE records, benefits in kind, expenses and employment status. We review your records before any visit and attend HMRC meetings on your behalf.
05
Voluntary Disclosures (CDF, Let Property Campaign)
If you have undeclared income, a voluntary disclosure made through the correct HMRC channel — and before HMRC contacts you — results in significantly lower penalties than being caught. We manage the entire disclosure process.
06
Penalty Reviews and Appeals
Where HMRC has issued penalties, we review the basis of the assessment and lodge formal appeals where there are grounds. Penalties for careless or innocent errors can often be substantially reduced or eliminated with the right representations.
02
Document Review & Position Analysis
Before any communication with HMRC, we conduct a thorough review of the relevant records and returns, identifying any genuine issues and any areas where HMRC may be on weak ground.
03
Taking Control of Correspondence
We register as your agent and take over all written and verbal communication with HMRC from that point forward. Nothing goes to HMRC without our review — and nothing from HMRC reaches you without our analysis.
04
Voluntary Disclosure (Where Appropriate)
Where there is genuinely undisclosed income, an early and complete voluntary disclosure — made in the right way — typically results in significantly reduced penalties compared to continuing to resist. We advise clearly on when this is the right approach.
05
Negotiation & Settlement
We negotiate strongly with HMRC on the quantum of any additional tax, the penalty percentage, and the terms of settlement — including instalment arrangements for payment if required.
06
Resolution & Future Protection
Once the matter is resolved, we review your returns and record-keeping to identify any vulnerabilities that could trigger future enquiries — and address them proactively.
What's Included

Full representation, start to resolution

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FAQ

Frequently asked questions

What triggers an HMRC investigation?
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HMRC uses a system called 'Connect' which aggregates data from hundreds of sources — banks, letting platforms, Companies House, DVLA, the Land Registry, overseas tax authorities and social media. Common triggers include expenses that appear high relative to turnover, lifestyle inconsistent with declared income, industry benchmarking anomalies, late or amended returns, and random selection. Sometimes there is no specific trigger.
What should I do immediately if I receive an HMRC letter?
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Contact us before you respond to HMRC. Do not call HMRC directly. Do not send documents without our review. The initial response to an enquiry sets the tone for the entire investigation — and mistakes made at this stage can be very difficult to recover from.
What is a Code of Practice 9 investigation?
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COP 9 is HMRC's most serious civil investigation procedure, used where fraud is suspected. Under COP 9, HMRC offers you the opportunity to make a complete voluntary disclosure via the Contractual Disclosure Facility (CDF). If you accept and make full disclosure, HMRC agrees not to pursue a criminal prosecution. This is an extremely serious situation requiring specialist representation from the outset.
How are penalties calculated?
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HMRC penalties are calculated as a percentage of the 'potential lost revenue' — the additional tax arising from the investigation. The percentage depends on the behaviour (unprompted/prompted, careless/deliberate) and the territory involved (UK/offshore). Penalties for prompted, careless errors can be as low as 0–15% of the tax owed, while deliberate, concealed offshore errors can attract penalties of up to 200%. Strong representation can significantly reduce the final percentage.
Can I make a voluntary disclosure even if I haven't been contacted by HMRC?
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Yes — and you should, if you have undeclared income or errors in previous returns. An unprompted voluntary disclosure (made before HMRC contacts you) results in the lowest possible penalty rate, typically 0–30% depending on the nature of the disclosure. Once HMRC contacts you, the disclosure becomes 'prompted' and the minimum penalty rate increases significantly. We manage voluntary disclosures through the appropriate HMRC campaign or the standard amendment process.
What is tax investigation insurance and do I need it?
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Tax investigation insurance (also called fee protection insurance) covers your accountant's professional fees in the event of an HMRC investigation. Premiums are typically modest and the cost-benefit is clear given that a serious investigation can involve many hours of professional work. We advise on and can arrange fee protection as part of our client care package.

Received an HMRC letter?
Contact us today.

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