Self-assessment HMRC enquiries

Once a self-assessment is submitted, HMRC has a window of approximately 12 months in which to raise an enquiry into that return. This will begin with a formal notice, usually by letter. The enquiry can take one of two forms, either an aspect enquiry or a full enquiry.  

As the names suggest, an aspect enquiry focuses on particular entries within the return, such as a capital gain.  These types of enquiry are typically selected due to data matching inconsistencies. HMRC continuously collects and analyses data gathered from sources such as land registry, electoral role, council tax, planning consents, companies house, passport control, import and export records. It also has been known to obtain information from social media and other internet searches.

Full enquires look into the whole of the return. There is no legal requirement for HMRC to inform the taxpayer of the reason for opening an enquiry and it does not do so when the return has been selected at random. Random enquiries allow HMRC to estimate the extent of under-declared liabilities arising from the submission of incorrect returns. 

There is no right of appeal against a decision to open an enquiry. 

HMRC will ask for information as part of the process to verify the tax position which must be provided within 30 days, however, extensions are often granted if a reasonable reason is cited. The enquiry process can be quite slow and can therefore be quite protracted before reaching an agreement over the final tax position. Once agreement has been reached a closure notice is issued. This is in the form of a written document which confirms the enquiry is closed and it sets out the officer’s conclusion.

At Dafferns we are experienced in dealing with enquiries and can guide you through this process. We understand that this can be a very daunting and worrying experience and we will keep you informed throughout the process.  We also offer Tax Fee Protection Insurance which covers our professional fees which can run into thousands of pounds.

Please ask us for more details if you are interested in taking out cover.