HMRC power to require information and documents

Produced by Tolley in association with Guy Smith of inTAX Ltd
HMRC power to require information and documents

The following Employment Tax guidance note Produced by Tolley in association with Guy Smith of inTAX Ltd provides comprehensive and up to date tax information covering:

  • HMRC power to require information and documents
  • Introduction
  • Pre-return checks
  • Information notices
  • Taxpayer notice
  • Third party notice
  • Identity unknown notice
  • Identification notices
  • Contents of the information notice
  • Statutory records
  • More...

Introduction

A framework of compliance checks, supported by the powers within FA 2008, Sch 36, enables HMRC Officers to:

  1. visit business premises to inspect the premises, assets and statutory records

  2. ask taxpayers and third parties for information and documents where they are reasonably required to check a tax position

These powers apply to most, although not all, of the taxes for which HMRC is responsible. They replace a number of separate powers which previously applied to different taxes and were used to obtain information. A list of the powers replaced by FA 2008, Sch 36 can be found in CH21050.

Not all powers have been replaced, and it is important to check that the Officer is using the correct powers for the correct period. Where FA 2008, Sch 36 and other powers overlap, guidance is given to Officers as to how to decide which power to use at CH21070.

Checks can only be carried out where it is reasonable to do so, and to check a tax position. Where the risk identified relates to a period which is out of time for assessment, the Officer should not pursue it.

A ‘tax position’ means a person’s past, present and future liability position with regard to any of the listed taxes, including penalties, claims and election, etc in connection with those taxes.

Pre-return checks

FA 2008, Sch 36 allows a compliance check to be made before a return has been submitted. A risk must be identified before an Officer carries out a pre-return check, unless the taxpayer has invited the Officer to make the check.

HMRC conducts pre-return checks in high-risk cases, eg where fraud is suspected or where the person is suspected of working as a ‘ghost’ trader and declaring no income.

Pre-return checks are also undertaken to follow up a previous check where poor record keeping has previously been identified. For example, where an inaccuracy penalty has been suspended and the Officer wishes to conduct a check to ensure that the suspension conditions have been met. See

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