Civil investigation of fraud – Code of Practice 8 (COP8)

By Tolley
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The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Civil investigation of fraud – Code of Practice 8 (COP8)
  • When is COP8 used?
  • Conducting a COP8 investigation
  • Concluding the investigation
  • Behavioural changes
  • Reviews and appeals

This guidance note provides an overview of how HMRC approaches a civil fraud investigation where it has decided that it is not appropriate to use Code of Practice 9 (COP9). Please see the Fraud civil investigation – COP9 offer made from 30 June 2014 – overview guidance note for more information on a COP9 investigation.

When is COP8 used?

HMRC may elect to use COP8 to investigate a ‘person’ it considers has deliberately tried to pay less tax or taken advantage of a scheme or device intended to reduce their tax liability. A COP8 investigation will not normally be undertaken with a view to a criminal prosecution but HMRC will consider this avenue should it find evidence of fraud during its investigation. HMRC can also elect to use COP9 or a criminal prosecution under PACE 1984 (subscription sensitive) is more appropriate than using COP8 based on the facts discovered during the course of its investigation.

HM Revenue and Customs Fraud Investigation Service – Code of Practice 8 

It should be noted that different rules are applicable in Scotland and Northern Ireland for criminal investigations.

HMRC has stated that it will investigate any circumstances where it believes that there may have been significant tax loss and it will investigate individuals, partnerships, LLP’s, companies and trusts. Its investigation will cover all taxes, levies, duties and contributions for which HMRC has responsibility.

Conducting a COP8 investigation
Opening the investigation

When HMRC decides that it is going to start an investigation into a persons’ tax affairs then it will normally review the tax / VAT returns, accounts, statements and other sources. HMRC also has the power to request information from third parties and it can do this before it contacts the person or their adviser in order to determine whether there is a matter that

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