This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

Enquiry Manual

Working the Enquiry: Moving from Aspect to Full Enquiry

If we make a decision to work the case as a full enquiry, reclassify it as full.

It is not possible to lay down hard and fast rules for every possible situation in which aspect enquiries need reclassification to full. You should generally consider whether to develop your enquiries into a full examination of the return when something has come to light which suggests that more is involved than, for example,

  • a straightforward mistake,
  • a misunderstanding of the legal position, or
  • a genuine dispute as to the tax consequences of a transaction,

and this raises questions about the reliability of the rest of the return.

For instance, your exploration of the facts underlying a computation may lead you to conclude that the taxpayer deliberately mis-stated the position or even tried to cover up those facts that conflicted with the gloss they put on the transaction. You will need to assess the degree of mis-statement involved and decide whether the whole return is likely to be fundamentally flawed. If you conclude that the accuracy of the whole return is open to doubt you should extend the scope of your enquiry.

When moving from an aspect to a full enquiry you will need to reclassify the case for recording purposes. As your opening letter in the aspect enquiry would have indicated that we would look at certain issues only, you should tell the taxpayer that you are now widening your enquiries.

Reasons for extending enquiries

The initial section 9A notice covers all enquiries into that return, whatever their nature or scope. Taxpayers and their agents, when faced with the development of what was originally an aspect enquiry into an in-depth examination of the whole return, may question the reasons behind your decision. You should already have explained to the taxpayer and agent what information has caused you to consider that more is involved than simple error or a difference of opinion and led to your decision to extend the scope of your enquiry. Apart from explaining why you did not take up matters earlier, when in theory you might have done, you do not need to justify your wider enquiries.

You should continue your enquiry by requesting all the information that you now consider is necessary to check the return.

If the taxpayer does not agree they will normally have the right of appeal against any information notice you issue to obtain this information under FA08/Sch36, see CH24300.

Where disputes do arise about extending your enquiry or your request for information, you should consider whether Alternative Dispute Resolution (ADR) may help you and the taxpayer resolve these. See the ADR web pages for guidance about ADR.

If the taxpayer does not agree with the outcome of ADR, they still have the right to appeal. In any proceedings before the tribunal, they will be able to advance the argument that the information you have specified is not reasonably required for the purpose of checking their tax position because you have already obtained all the relevant information. Alternatively, they will be able to ask the tribunal to direct that the enquiry should be brought to a conclusion EM1975+.