Q: I have received notification from HM Revenue and Customs that they want to enquire into my tax return. What will happen and is there anything specific that I should do? JI, Larne
Answer: On receipt of an enquiry notice from HMRC, you may need to contact a tax adviser to assist you with your correspondence. HMRC will request specific information within the enquiry notice and specify a date by which you must respond. You should contact HMRC if you believe you cannot meet the deadline.
Once you have responded to HMRC, you will have to wait for a reply. HMRC will either request further information or inform you that the enquiry is closed, at which point you will be informed of any further tax liability or overpayment.
Your best defence is to ensure that your initial reply is complete, accurate and supported by documentary evidence as far as possible. In the absence of supporting documents, your explanations must be reasonable and plausible.
If further information has been requested, this will have to be provided to HMRC for examination. In order to assist with your enquiry, be open and honest - but be mindful only to provide relevant information.
If you have an agent preparing your tax return, they should be able to instruct you (any additional fees may be covered by insurances). If you do not have an agent, you should consider appointing one, because many individuals find the enquiry process stressful. An agent can also be of assistance while ensuring the Inspector is acting within the limits of his or her powers - this is particularly important, because as from April 1 HMRC have had new powers when dealing with enquiries.
Send your questions to: email@example.com. We will answer as many queries as possible but regret we cannot enter into individual correspondence.
Keith Storey is a Director in ASM Horwath. He is experienced in providing advice to both private and corporate clients. His areas of expertise include pre and post retirement planning, developing individual investment strategies, inheritance tax planning, and life and illness protection plans. ASM Horwath, 20 Rosemary Street, Belfast BT1 1QD (NI 37083) is a company registered in Northern Ireland and is authorised and regulated by the Financial Services Authority, FSA registered number 193758.
Alan Curry is Director of Tax at ASM Horwath. He is a member of both the Institute of Chartered Accountants in Ireland and the Chartered Institute of Tax and his areas of expertise include tax compliance & planning, employment & personal tax, VAT, trusts & estates, retirement planning, inheritance tax, divorce & separation, and capital taxes planning.
Alan and Keith can be contacted at tel: 028 9024 9222.
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