Published: 05/07/2023 By Dean ClarkCode of Practice 9 (COP9), also known as Contractual Disclosure Facility (CDF), is the formal process by which HMRC’s Fraud Investigation Service, investigates serious/organised tax fraud.
Whilst often considered amongst the most serious type of tax investigation (and somewhat of a taboo area of tax), it is with interest we note that HMRC have recently announced they plan to accelerate, their use of Code of Practice 9!
Where HMRC suspects deliberate tax fraud may have arisen, HMRC can use COP9 legislation, once agreed, in order to offer a taxpayer the opportunity to admit to all known tax irregularities and fraudulent tax behaviours committed; in return for which the investigation will be dealt with as a civil investigation (as opposed to a criminal investigation!) This gives the taxpayer every opportunity (where appropriate) to disclose any losses of tax caused by deliberate behaviour, whether this was intentional or not. The taxpayer can then pay any tax owed as well as any additional penalties and interest charges.
In brief, a COP9 tax fraud investigation will involve HMRC and the taxpayer entering into a formal agreement, whereby the taxpayer must be open, honest and transparent in admitting to the tax irregularities believed to exist. Only by fully complying with HMRC’s COP9 procedures will a taxpayer typically be able to avoid criminal prosecution.
On 14th June HMRC refreshed its COP9 guidance (read the official document here) noting the following key points for taxpayers:
- A reminder that the CDF offered by HMRC is an alternative to a criminal investigation.
- There are new terms for the CDF to ensure the recipient is clear on exactly what is needed of them, including the consequences of non-compliance, this may include a meeting with HMRC.
- New guidance has also been added which sets out different situations where a COP9 case may need to be escalated from a civil to a criminal investigation leading to prosecution. Including what HMRC can do if the taxpayer revokes their admission of fraudulent behaviour following an accepted CDF offer.
These are just a few of the changes. Tax fraud is a serious matter. Here at turpin barker armstrong , we have considerable experience, forged over many years, dealing with these most serious types of tax investigations.
HMRC strongly recommend a taxpayer seeks professional representation should they be subject to a COP9 investigation. Our tax investigation services offer peace of mind as we can provide full representation, safe in the knowledge we are able to serve the best interests of the taxpayer. Through what can be very difficult times, turpin barker armstrong will be there the whole way through the investigation process, from initial meeting (interview) to eventual conclusion, dealing with HMRC on a taxpayer’s behalf, every step of the way.
Dean Clark, long standing partner and our in-house COP9 expert, will be happy to offer an initial fee consultation (without obligation), and will treat all such matters discussed discreetly with the upmost confidentiality.
Please contact Dean Clark FCCA on 020 8661 7878 or email email@example.com or to complete our contact form