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HMRC internal manual

Technical Teams Operational Guidance

Investigation work: establishing the facts: reaching agreement on income or profit addition: we should not proceed to settlement until the facts are established

Advisers sometimes attempt to cut short an investigation by suggesting a settlement before the facts are established. They may be motivated by anxiety from their client to see the case concluded, a concern over means, or a view that nothing more will emerge. Such genuine concerns may obscure a taxpayer’s dishonest desire to conceal facts that may increase liability or show culpability.

Resolving issues and disputes in line with HMRC’s approach to settlement and litigation is mandatory. Where possible we should follow the sequence of events described at TTOG12130. But we always have to consider the practicalities in each case. Our objective is to be satisfied in the context of the case that we have investigated as far as we can to identify the primary frauds or areas of tax loss and quantified issues to our reasonable satisfaction.