Protecting your business from the cost of an HMRC investigation

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Even the most diligent taxpayer can find themselves under the scrutiny of HMRC and face an investigation. 

With letters, enquiries and investigations from the Revenue on the rise in 2025, driven by enhanced powers, increased use of data analytics, and an expanding list of compliance targets, it has never been more important to protect yourself and your business.

Having worked with many taxpayers, we know how stressful and disruptive a tax investigation can be. Even when there’s no wrongdoing, the financial and emotional toll can be considerable.

That’s why we offer a comprehensive fee protection service, designed to shield you from the professional costs involved in defending your position.

What does HMRC investigate?

HMRC can investigate individuals and businesses through:

  • Full enquiries, which involve a detailed review of all tax affairs
  • Aspect enquiries, focusing on specific areas (e.g. capital allowances, property income)
  • Random checks, which can occur even where no risk is flagged

Investigations may be triggered by:

  • Irregularities or large variances in tax returns
  • Late or inconsistent filings
  • Sector-specific targeting (e.g. construction, landlords, digital services)
  • Data from third parties or online marketplaces

However, HMRC can and does conduct random inspections of taxpayers’ affairs from time to time, as part of their ambitions to close the tax gap.

Be aware, that HMRC can go back up to four years for genuine mistakes, six years for carelessness, and twenty years where they suspect deliberate evasion.

The impact of an investigation

Whether it’s a short enquiry or a complex case stretching over a year, an investigation can:

  • Drain time and focus away from running your business
  • Lead to legal and technical complications
  • Create uncertainty over your financial position
  • Incur significant professional fees, even if no additional tax is due

We have supported clients through all types of investigations. In every case, early intervention and expert representation can make all the difference.

How our fee protection service helps

To give you peace of mind, we offer a fee protection service that covers up to £100,000 of our professional fees relating to an HMRC enquiry. This includes:

  • Income Tax and/or Corporation Tax Self Assessment enquiries
  • PAYE and National Insurance compliance checks
  • VAT and IR35 reviews
  • Construction Industry Scheme (CIS) enquiries
  • National Minimum Wage, Gift Aid, and Child Tax Credit issues
  • Inheritance Tax enquiries
  • Any dispute following a notice of assessment or penalty
  • Enquiries under Code of Practice 8, where fraud is not proven

Whether it’s a one-off request or a prolonged investigation, our fee protection gives you access to our team’s full support without worrying about escalating costs.

How our tax investigation experts help you

We combine proactive, pragmatic advice with a deep understanding of HMRC processes.

Our tax specialists can:

  • Review the validity of an enquiry
  • Liaise directly with HMRC on your behalf
  • Ensure that any information requests are fair, relevant and appropriate
  • Guide you through voluntary disclosures where necessary
  • Minimise disruption to your business and avoid unnecessary delays or penalties

Because we deal with these matters day in, day out, we know how to handle even the most challenging of enquiries with confidence and clarity.

What you can do to prepare

To reduce your risk and improve your position if an enquiry arises:

  • Keep clear, accurate records
  • Respond to HMRC promptly or ask us to manage correspondence for you
  • Avoid supplying unnecessary information, which can open new lines of enquiry
  • Review your compliance processes, especially around PAYE, VAT, and subcontractor rules
  • Speak to us early if you suspect an error in your return, as early voluntary disclosure can significantly reduce penalties

Don’t let an investigation derail your plans

HMRC enquiries are rarely random and almost always carry the risk of disruption. With the right support and protection in place, they don’t have to become a financial burden.

Our fee protection service is a clear, cost-effective way to defend your business against the growing risk of investigation.

To learn more or to protect your business, speak to the Milsted Langdon team.

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