Tax Investigations
Tax Investigations are on the increase. Would you know how to handle one?
WHO ARE QDOS TAXWISE?
Qdos Taxwise Limited is a company that provides insurance to cover professional fees arising from HM Revenue & Customs (HMRC) enquiries. Our staff have many years’ experience of dealing with Tax Enquiry Insurance and all issues relating to enquiries by the tax authorities. We also offer advice and consultancy on tax, VAT, employment law and health & safety.
WHAT IS TAX ENQUIRY INSURANCE?
Tax Enquiry Insurance is an insured service designed to cover the professional fees incurred during HMRC enquiries, including Income Tax and Corporation Tax Self Assessment enquiries and disputes arising from VAT enquiries and Employer Compliance Reviews.
INSURANCE COVER INCLUDES:
The maximum amount insured is £75,000 in any one claim, against:
Income Tax Self Assessment full and aspect enquiries.
Corporation Tax Self Assessment full and aspects enquiries.
Disputes arising from HMRC VAT enquiries.
Disputes arising from HMRC Employer Compliance Reviews.
IR35 and other status disputes arising from HMRC enquiries.
There is no excess
Personal cover for directors, partners, the proprietor and their spouse:
To ensure seamless cover, the business premium covers enquiries into the tax returns of the directors, partners, the proprietor and their spouse or civil partner provided the appointed accountant has prepared the latest tax return of the individual. A separate higher rate premium may be required should any individual exceed the income limits for private clients as agreed with your accountant.
Main exclusions:
Enquiries or disputes which commenced prior to your nomination for inclusion under this service
Enquiries following the late submission of tax returns
Where prime records are not kept
Where fraudulent evasion of tax is involved
Some tax avoidance schemes
A copy of the full policy wording is available upon request
TAXWISE FEE PROTECTION INSURANCE
What powers do HM Revenue & Customs now have?
As of April 2009 HMRC are able to visit business premises to inspect records covering all taxes including corporate, income, PAYE, NI, Capital Gains and VAT. They can now also issue written queries before you have even submitted your annual tax returns.
Can anyone’s tax affairs be scrutinised by HMRC?
Anyone that pays tax can come under scrutiny. Every year, HMRC starts enquiries into thousands of personal and business tax returns and accounts. VAT and PAYE payments are also thoroughly checked. The aim in every case is to collect more tax.
I’ve done nothing wrong, why should I worry about a tax enquiry?
Most enquiries are generated by computer “risk profiling” and many are selected completely at random. As a result, HMRC sometimes picks the wrong targets. Even if you have done nothing wrong, the taxman will not give up and will still try hard to find errors.
How much could a tax enquiry cost me in professional fees?
The questions asked by HMRC are usually very detailed and time–consuming to answer. The costs of defending you can easily run into thousands of pounds, even if little or no extra tax is paid at the end of the enquiry. These costs are not covered by the normal annual fees paid to your accountant.
Is there anything I can do for peace of mind?
You can subscribe to the Taxwise Fee Protection Insurance Scheme which will cover you for the work and costs of defending you in the event of a tax enquiry by HMRC.
What is the Fee Protection Insurance Scheme?
It is a scheme set up by your accountant to protect clients from HMRC queries. For a small annual premium, you can purchase a fee protection Policy and obtain the benefits described opposite. Under the policy, your accountants’
professional costs incurred defending you in the event of a tax enquiry or dispute will be covered.
What are the main benefits of the policy?
• Your accountant will defend you should you receive any correspondence or visit from HMRC
• The potentially high costs of professional fees for that defence will be claimed under your insurance policy
• It will not be necessary to accept unreasonable tax charges by HMRC due to concerns about professional fees
What is covered by the Policy?
You will be fully protected under an insurance policy which provides cover for up to £75,000 of professional costs in the following circumstances:
• Dealing with any correspondence from HMRC
• Attendance at any meeting with HMRC
• Appeal to the First-tier Tribunal or Upper Tribunal
What is not covered?
Some costs will not be covered under the Scheme, including the following:
• Routine compliance work, e.g. preparing your tax return
• Overseeing HMRC whilst they review your records
• Outstanding taxes, penalties, interest or any other amounts due to HMRC
• Defence of criminal prosecution cases or serious fraud enquiries
• Fees relating to pre-existing tax enquiries
What will it cost to join?
Please contact Louise on 01462 422555 who can provide details separately of the annual premiums that are payable by different categories of clients.
How do I join or obtain more information?
To obtain cover under the Scheme please contact Louise on 01462 422555. A cheque for the amount due should be sent to your accountant, unless otherwise stated. If you need any more information, please call Shane on 01462 422555.