Unannounced visits by HM Revenue & Customs (HMRC) to carry out inspections are becoming extremely common. In a recent case handled by Buzzacott’s Tax Investigations & Dispute Resolutions team, the client experienced a visit at his restaurant from five HMRC officers at 11pm on a Saturday night. At the time of arrival, the client wasn’t present meaning the officers started the investigation in his absence while customers were still on site.
Unannounced visits by HMRC have to be sanctioned either by ‘an authorised officer’ or the tax tribunal and have to be 'reasonably required' for the purposes of HMRC's (compliance) check. They also tend to be carried out by HMRC joint disciplines with direct and indirect officers working together.
Unannounced visits are typically made where HMRC have had either no co-operation with announced visit requests or when they believe records may be destroyed should notice of a visit be given (as suspicion is held that the correct amount of tax is not being declared).
The visits should be made 'at any reasonable time'. However, late visits to restaurants or other similar establishments are customary, made with the purpose of HMRC being present at the end of the business day during 'cashing up'. Such late visits, outside normal office working hours, do not give the individual being investigated the opportunity to confirm the identity of the HMRC officers.
Should you receive a visit, you are entitled to representation. Given that any evidence gathered on these visits can be used in later proceedings against a taxpayer (including criminal proceedings), it is imperative that you seek specialist representation.
The powers allowing HMRC to conduct unannounced visits do not give them the right of entry and a business owner does not have to comply with the inspection notice. In our experience, the vast majority of unannounced visits sanctioned by HMRC 'authorised officers' are suggested to be refused, particularly without the presence of a specialist advisor and especially at late hours. HMRC are using unauthorised visits to target particular trades, seemingly without any thought of the intimidating nature of this approach and the impact this could have to staff and customers witnessing the visit.
How we can help
If you are the subject of an HMRC unannounced visit do not hesitate to contact us. Our team provide a discreet and comprehensive service that is tailored to meet your unique needs and protect your interests.
For more information or advice please visit our team page or contact:
Head of Tax Investigations
+44 (0)20 7556 1243