HMRC Investigations Code of Practice 8

FIS may investigate any arrangements where HMRC believes that tax may have been inappropriately avoided, as a result of tax planning arrangements which it considers contrary to its interpretation of the law. Where it does so Code of Practice 8 (COP8) is issued.

Such enquiries are not restricted to the review of any planned avoidance’ transactions, but they can often arise in other circumstances such as when a person’s residence in the UK, or the tax implications of interests held in foreign entities is being questioned.

The potential range of enquiries undertaken by FIS under COP8 is almost unlimited and may be undertaken by FIS where there is no allegation or suspicion of fraud but where there is a suspicion of tax loss.

Enquiries under COP8, by their very nature, can be difficult, complex and are often contentious. Such investigations usually involve significant sums of tax either on an individual case by case basis or by reference to a large number of cases sharing the same planning arrangements. Whichever way these investigations are viewed they are serious and should be handled by practitioners who have significant experience of dealing with such matters at this level.