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Code of Practice 9 - Civil Investigation of Fraud

Code of Practice 9: Civil Investigation of Fraud

 
A Code of Practice 9 - COP 9 is generally considered to be among the most serious type of tax fraud investigation.

HMRC usually conducts investigations in accordance with COP 9 in cases where they have reason to suspect serious tax evasion, likely to generate a total yield of under declared tax, interest and penalties in excess of a minimum £75,000.

These investigations are carried out by main specialist divisions within HMRC, the 'Civil Investigation of Fraud' (CIF) unit, or the 'Specialist Investigations' (SI) team. Both divisions are staffed by experienced and highly trained tax fraud Inspectors and the seriousness of enquiries undertaken by both divisions simply cannot be overstated.

What is a Code of Practice 9 Investigation?


COP 9 investigations cover all the main taxes: Corporation Tax, Income Tax, Capital Gains Tax, CIS Tax, PAYE and VAT.

Once notification of an investigation under COP 9 has been issued, under HMRC’s formal Contractual Disclosure Facility (CDF), the individual(s) can obtain protection against the threat of ‘criminal prosecution’ for the alleged tax fraud, providing they agrees to provide full cooperation and compliance with the investigation, with a view to making full and complete disclosure of all tax irregularities.

It should be noted that HMRC reserve the right to instigate criminal proceedings against an individual(s) where materially false statements are made during the course of the investigation. Under a COP 9 investigation, HMRC can go back as far as 20 years to reclaim tax


The Key Points

Following initial contact from HMRC, an individual(s) will have a statutory 60 (sixty) day time period, to comply with the terms of the Contractual Disclosure Facility.

This will involve the individual(s): -
  • Preparing and submitting an initial ‘Outline Disclosure’ of all known areas where tax irregularities are thought to have arisen.
  • Sign a formal statement to confirm to HMRC that the information provided is accurate and complete.
  • To agree to pay all taxes, duties, interest and penalties due.
  • To stop any evasion with immediate effect.
Following this sixty day period, the individual(s) is then invited to attend an initial interview with HMRC officials, at which point formal questioning will be undertaken. At this meeting opportunity will be given to discuss matters incorporated within the initial Outline Disclosure, and to agree to make a full and complete disclosure of all known irregularities in their tax affairs over the last twenty years.

HMRC will then formally instruct the individual(s) to produce a full 'Disclosure Report', which will include a brief business history, the nature and extent of all tax irregularities identified (where applicable), and how they arose, together with a wealth of information, summaries, third party responses , as deemed necessary to ultimately quantify the correct levels of tax and/or duties due and payable.

Furthermore the individual(s) is also obliged to submit a certified statement of ‘worldwide’ assets and liabilities, together with certificates of all bank /building society accounts, and credit cards operated, throughout the period covered by the Disclosure Report.

Usually HMRC has an expectation of receiving the Disclosure Report within six months following the date of the opening meeting.

How we at turpin barker armstrong can help!

Due to seriousness of these tax fraud investigations, HMRC encourage those under COP 9 investigation to appoint professional advisors to help guide them through the process and to offer advice, assistance and support throughout.

As highlighted above, COP 9 offers the chance to avoid prosecution and it is essential that help and advice be taken at the earliest opportunity.

HMRC expects high standards from your chosen professional advisor and here at turpin barker armstrong, we have considerable experience helping people through these most worrying and stressful of times.

It is highly recommended that a professional advisor is present at each meeting with HMRC to provide guidance and support in ensuring the individual(s) is treated fairly, and their best interests are protected.

Working closely with the individual(s), turpin barker armstrong offer a comprehensive service to ensure that from the point of initial contact, right through to the eventual conclusion of the investigation, and individual(s) is professionally represented at all times.

A good report is considered critical in determining the correct amount of tax and duties payable, together with assisting the individual(s) to mitigate interest and penalties assessable. Whereas a badly prepared report may potentially increase a taxpayer's eventual liability, and also the risk of criminal prosecution!

We understand from experience how distressing an investigation of this nature can be. Through our expertise and experience we are ideally placed to work alongside the individual(s), liaising with HMRC on their behalf, and helping to bring the investigation to a prompt conclusion.

Contact Us 

We offer a truly personal service at a time when it is most needed and our fee structures are extremely competitive.
If you would like to discuss how we might be able to assist please contact us now to arrange an initial consultation, completely free of charge and without obligation.

Please contact Dean Clark FCCA on 020 8661 7878 or email dean.clark@turpinba.co.uk
(You can be assured that all information will be treated in the strictest of confidence)






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