September 10, 2020

Tax investigation Insurance

We all have subscriptions to different insurance policies to protect us against the eventuality of a car accident, or a leak in the roof. However, what about your tax return? Are you protected if HMRC opens a costly investigation into your personal or business affairs?

That is why at Jack Ross we offer a Tax Investigation Service to protect you from the professional costs, stress and uncertainty brought about by a HMRC enquiry.

Even if there is no additional tax to pay, investigations and enquiries can cost thousands and last for many months, even years.

We have a client with an ongoing HMRC enquiry that started some years ago and is still ongoing through no fault of their own. It is likely that our client will not have any additional tax liabilities as a result of the enquiry, but the fees associated with dealing with HMRC will run to several thousand.

Thankfully, our client is covered by investigation insurance, and so has peace of mind.

If you are subject to a HMRC enquiry, you can incur thousands of pounds in accountancy fees, even if at the conclusion it is found that there is no additional tax to pay. 

For a modest premium, Tax Fee Protection Insurance covers accountancy fees incurred by Jack Ross in the event of an enquiry, providing you with peace of mind, knowing that our fees are covered and you have the resource to provide a strong defence. 

Being the subject of a HMRC enquiry is stressful, our Fee Protection Insurance will help you to relax. 

Why would HMRC target me?

HMRC were targeted with achieving additional tax revenues of over £30 billion through compliance activities in 2018/19. In the past decade, the number of enquiries undertaken by HMRC has increased significantly, year on year.

Any individual or business can be subject to an enquiry, even if your affairs are in order. 

Through Sch36 of the Finance Act, HMRC have wider powers than ever before. In recent years, HMRC have recruited 2,500 new Compliance Officers to help achieve their ambitious targets. 

The chances of you being subject to a HMRC enquiry have never been higher. 

If you are chosen for investigation, we will assist you every step of the way, leaving you to do what you do best.

To ensure early resolution, early professional representation is an essential part of your defence.

How does Tax Investigation Insurance work?

For example:

You get notified by HMRC that you or your business owes £8,500 in unpaid tax. You instruct us to work on your behalf and provide information to HMRC. Hopefully, this will get the tax demand reduced.

We then spend £1,500 of our time dealing with HMRC and getting to the bottom of their enquiry.

What if I don’t have Tax Investigation Insurance?

The best case scenario: we manage to get the tax bill down to £0, but you still have to pay £1,500 in total of our fees. 

The worst-case scenario: we haven’t been successful, so you owe the £8,500 to HMRC and £1,500 to Jack Ross, meaning your total is now £10,000. 

What if I have purchased Tax Investigation Insurance?

The best case scenario: we manage to get the tax bill down to £0 and the £1,500 is paid for by the insurance. Your total is £0 

The worst case scenario: we have not been successful, so you owe £8,500 to HMRC, but the professional fees are paid for by the insurance, meaning your total is £8,500 
 
It is important to remember that tax is not optional and Tax Investigation Insurance does not cover the amount owed to HMRC.

It simply covers the professional fees associated with a HMRC enquiry. 

Why avail of our Tax Investigation Insurance?

If the potential savings of thousands of pounds did not sway you, we can confirm that our Tax Investigation Service, in partnership with Croner Taxwise, also includes:

  • Representation from us in the event of a HMRC investigation.
  • £100,000 fees indemnity on this insurance backed service with no excess.
  • Peace of mind that we will deal with HMRC on your behalf, limiting the concern and stress of spiralling additional fees.

 If you are in business, it gets even better; our service includes the furlough support package

  • Representation from us in the event of any HMRC enquiries relating to claims made via the Coronavirus Job Retention Scheme.
  • Access to HR Advice for any HR issues within your business, this extends to the specialist furlough team, who can advise on all HR issues relating to furlough.
  • Health & Safety and Legal telephone advice line.

And if you trade via a limited company, you are covered for enquiries into the personal tax returns of all of the directors, as well as HMRC enquiries into the company

If you would like to ask us any questions, please ask for your usual Jack Ross contact on 0161 832 4451, or send them an email.