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HMRC internal manual

Enquiry Manual

HM Revenue & Customs
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Working the Enquiry: Keeping Control: Countering Delay

The discretionary right to enquire into any return means that you should be able to open enquiries in a non-confrontational way, without long drawn out arguments about whether you have adequate grounds for taking the case up.

You should not issue reminders to taxpayers or agents - either in a letter or on the telephone - without at the same time taking some more positive action. Reminders along the lines of `I do not appear to have heard from you ….’ are unlikely to lead to a substantive response and will only drag out the time it takes to bring the enquiry to a conclusion. The SA legislation provides a structured framework for dealing with enquiries into tax returns and the stages of the enquiry are clearly set out. The enquiry framework encourages building a dialogue and relationship with the agent which should also assist in prevention of delay.

If a taxpayer or agent has not produced the information you have requested you should consider whether you can help them to comply. You should always be prepared to respond positively to any reasonable request from the taxpayer or agent to examine documents or hold meetings at the taxpayer’s or agent’s premises. In appropriate cases you should consider contacting the taxpayer direct if you believe that any delay is being caused by the agent.

Information powers

The normal response to lack of co-operation or delaying tactics on the part of the taxpayer or agent will be the use of the information powers in FA08/Sch36 CH20000+.

Assessments and determinations

The only HMRC assessments under SA will be discovery assessments, and these should not be made routinely. For SA years where returns are outstanding, daily penalties EM4570 can be raised and determinations made EM2027.

Co-ordinating Forcing Action

If you are unable to agree the additional tax due on a self assessment at the time you have decided to reopen earlier years and the taxpayer is resisting your enquiries you will need to co-ordinate actions to overcome any delay. For example the taxpayer may make a request to the tribunal under Section 28A(4) for the SA enquiry to be closed and at the same time you may be waiting for books or information relating to the current and earlier years and have open appeals against Section 29 assessments. It may be preferable to ask the tribunal to hear all disputed points together in linked hearings, see ARTG8500.

Closure notices

Exceptionally you may have to counter non-co-operation by issuing a closure notice EM1975+.