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HMRC internal manual

Specialist Investigations Operational Guidance

Settlement by agreement: means to fund the offer: need for advice on current assets

In some SI Investigations cases, for example Code 9 cases, the asset position of the taxpayers will normally have received attention right through from initial review. However, the focus of the attention will often have been on the historical position in the investigation period. The most recent asset statement may be several years in the past and there may be no, or only anecdotal, information on the current private asset position and the business and private prospects for future earnings.

In other instances, for example Code 8 cases, all of the above may apply with additional complications of disputed beneficial ownership, funds abroad, and such like, that are unresolved because they are at the heart of the investigation.

The first action when it appears that there will be a means problem at settlement should be to ask the taxpayer’s adviser to indicate the extent of the difficulty and advise current assets and prospects. This must involve some degree of assumption about the likely quantum of settlement but it can be made clear that - on both sides - this is completely without prejudice.