HMRC criminal investigations and dawn raids
Published by a LexisPSL Tax expert

The following Tax practice note provides comprehensive and up to date legal information covering:

  • HMRC criminal investigations and dawn raids
  • Civil or criminal?
  • Civil penalties for tax fraud
  • Civil or criminal—factors HMRC will consider
  • HMRC's criminal investigation powers
  • Dawn raids
  • Tax related offences

HMRC criminal investigations and dawn raids

HMRC can investigate suspected tax-related criminal offences in England and Wales using the powers, and subject to the safeguards, in the Police and Criminal Evidence Act 1984 (PACE 1984).

There is parallel legislation for Northern Ireland. PACE does not apply in Scotland but there is legislation containing powers and safeguards that mirror the PACE provisions, adapted to the Scottish legal system. The remainder of this Practice Note refers to the legislation in England and Wales.

In addition to HMRC’s powers to investigate tax-related criminal offences in Wales, the Welsh Revenue Authority has powers to investigate offences relating to Welsh devolved taxes.

Tax investigations may also be carried out by the National Crime Agency (NCA), which is independent from HMRC. The NCA's function is to recover money and assets derived from criminal activity. It can investigate a person's tax affairs if it reasonably suspects that person has money or assets that derive from criminal conduct and that are chargeable to tax.

For example, the First-tier Tax Tribunal has held that the NCA had reasonable grounds to suspect that income arising to a taxpayer was chargeable to income tax and arose as a result of criminal conduct in circumstances where he was suspected to be involved with an organised crime group and had unexplained income.

Although HMRC can investigate tax-related offences, it does not decide

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