Like it or not, since self assessment for income tax (and since then, for corporation tax too) was introduced, more and more of HM Revenue & Customs resources are being devoted to tax investigations of one sort or another.  In fact, income tax, corporation tax, PAYE, VAT and National Insurance all come under the watchful eye of HM Revenue & Customs, and you can assume that if your business receives a VAT inspection which throws up a potential problem in your PAYE compliance, it won’t be long until you receive a visit from a PAYE inspector.  The additional tax generated from such investigations is considerable, and there is little or no prospect that activity on this front will diminish.

Although our accounts and tax processes are designed to minimise the prospects of an HMRC assault on your business, there is no defence against a random investigation, or a ‘fishing expedition’ where HMRC initiate an investigation without giving any reason for the selection.  Typically, investigations can last for many months, and the highly detailed work needed to counter allegations of potential wrongdoing can run into many thousands of pounds.

We therefore recommend that all of our clients effect insurance cover for the professional fees cost of an investigation by HMRC.  The annual premium is inconsequential compared to the fees that it covers, and it provides real peace of mind in such an eventuality.

For a no obligation quotation of the annual cost of fee protection cover, contact Steve Gray.