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HMRC internal manual

Fraud Civil Investigation Manual

Where CDF offer is made 30 June 2014 onwards: managing the detailed disclosure process: customer reluctance to provide a disclosure report

When a customer is reluctant to instruct their adviser to prepare the disclosure report or fails to provide their adviser the information that is required, each case must be judged on its own particular circumstances to decide how we believe our investigation can best be brought to a satisfactory conclusion.

Sometimes the customer, after making an Outline Disclosure, might hesitate to instruct an adviser to prepare a more detailed disclosure report. They might, for example, argue that

  • HMRC can very quickly see for themselves the amounts that are involved and reach agreement
  • they do not have the means to meet the professional fees of a detailed report.

We cannot compel a customer to commission a detailed report, but in some cases it might be appropriate to refer the customer again to the Code of Practice 9, and their commitment to make a full disclosure of all irregularities.

If the customer still declines to instruct an adviser to investigate, but offers cooperation to HMRC, they should firstly be invited to

  • quantify the disclosure, setting out the period involved
  • show in sufficient detail how they quantified the irregularities
  • complete, to the best of their knowledge and belief, a statement of assets and liabilities and certificates of bank accounts and credit and debit cards operated
  • Provide these documents within an agreed timeframe including a description of the tax fraud and how it was perpetrated
  • make a commitment to pay and make a payment on account (if one has not been made at that point)

The investigator should then consider taking up the access and cooperation offered, so that they can investigate the matter in more detail.

In other cases although a detailed report has been commissioned, you might find that it is not being progressed satisfactorily, because the customer has not been providing the cooperation that the agent needs to complete it. If this happens you should write to the customer immediately, with a copy to the agent, to draw their attention to the potential implications. The level of contact with the customer and their agent will depend on the individual circumstances of the case, but the emphasis is on robust case management. Investigators should take over the investigation in all cases where the customer is not cooperating fully to produce the detailed report within the agreed timescale, using formal powers to obtain the work done by agent thus far if necessary.