If you are wondering where HMRC have been enquiry wise then wonder no more. They will be back with a vengeance.

HMRC all but stopped enquiries (tax investigations) from mid April 2020 as it shifted many of its investigations staff into helping taxpayers with emergency coronavirus support schemes. As a result, penalties being imposed on taxpayers for underpayment or late payment of taxes fell dramatically.

Don’t expect this become any kind of “new normal” though as HMRC are not only allocating people back to their original duties but are also allocating additional resources to look into the misuse of the government’s support schemes, such as the furlough scheme, during the pandemic.

If there is something on your mind tax enquiry wise now is the time to come forward. HMRC will often impose much lower penalties and surcharges on taxpayers that own up than on those they have to find.

With 27,000 “high risk” furlough claims in the system a lot of those claimants will wish they had taken advantage of the amnesty that ended on October 20th. Even still it will be much better to make a voluntary declaration now than wait for the inevitable knock. The alternative is to brace for the highest possible level of penalties. After all public opinion will fully support HMRC making examples of those that have deliberately taken advantage of the public purse.

Penalties can rise to as much of 100% of the amount of tax HMRC believes it is owed, depending on whether mistakes resulted from careless or deliberate behaviour by taxpayers

Contact our tax team if you would like to make a declaration to HMRC: taxteam@robson-laidler.co.uk