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HMRC internal manual

Technical Teams Operational Guidance

Settling the enquiry: introduction: sequence of events

In most Code 8 and 9 cases a broad sequence of events that applies. In some cases the steps will merge. Once the investigation phase of a case is over the Investigator will typically:

  • bring together the facts of the case established by investigation
  • reach a view of whether the facts support a conclusion that there is additional income, profits, gains or a restriction of allowances or reliefs
  • seek to agree with the taxpayer’s adviser the quantum of the additional income, profits etc that apply
  • consider and then seek agreement on the direct and indirect tax effects that follow from the additional income or profits etc to the point of agreeing where possible the precise additional tax due from all participants
  • continue to keep the question of culpability under review
  • consider the taxpayer’s means to settle the additional tax and where applicable the interest and penalties due
  • seek to negotiate an overall settlement - this may include all liabilities in a payment arrangement expressed in a contract offer
  • deal with any related matters of tax treatment, future position, carried forward values for losses etc so that the case can be passed tidily back (within 30 days) to the relevant Business Unit to deal with future years.

The guidance in the Enquiry Manual on concluding the enquiry applies equally to SI investigations and should be followed where appropriate.

TTOG5100 is concerned with matters up to and including the agreement of additional income or profits and the consequent tax treatment. TTOG5200 deals with settlement by agreement and TTOG6000 with case closure.