Investigations into your tax affairs can have severe consequences on both a personal and business level, so they must be handled decisively and with care. We have a dedicated HMRC team whose sole focus is assisting clients with tax-related matters, including tax investigations. Our tax fraud lawyers use their considerable expertise and experience to secure the best possible outcome for our clients, resolving matters even before charges are brought wherever possible.

For a confidential free discussion, call us today on 01908 414990,  alternatively email us at or complete our Free Enquiry Form and we will call you back.


What is Tax Fraud?

The terms ‘tax avoidance’ and ‘tax fraud’ are sometimes used interchangeably, but they have different meanings. Generally speaking, tax avoidance involves using legal methods to minimise the amount of tax payable. Such methods often include deducting as many expenses as possible to reduce the taxable income and choosing investments that offer tax advantages over those that do not. Sometimes, tax avoidance is legal. However, HMRC has clamped down on a number of high-profile tax avoidance schemes that they consider bend the rules too far and involve contrived transactions to achieve an outcome not intended by Parliament.

Tax fraud, also known as tax evasion, on the other hand, is never legal. It involves using illegal means to deliberately evade a tax liability. Examples of the types of activities that may constitute tax evasion include the following:

  • Underreporting income, or not reporting income at all.
  • Concealing assets.
  • Maintaining two sets of books.
  • Using cash extensively to keep funds out of bank accounts.
  • Hiding money in offshore bank accounts.
  • Smuggling taxable goods.


What are the Consequences of Tax Fraud?

HMRC take a hard-line approach to tax fraud and have a variety of extensive and far-reaching powers at their disposal to address it. Their main concern is to recoup the money lost to tax evasion, but they may also seek criminal sanctions, such as imprisonment, in some cases.

  • Civil powers

HMRC usually use their civil powers to hold those involved in tax evasion to account. HMRC’s civil powers include carrying out compliance checks, making enquiries, and obtaining information and documentation from the taxpayer and third parties, such as banks.

If the outcome of HMRC’s investigation shows tax evasion, they will collect any unpaid tax and may issue financial penalties, which can be up to 200% of the unpaid tax. In some instances, such as when the company is insolvent, HMRC may hold an individual liable for the unpaid tax.

  • Code of Practice 9 powers

Code of Practice 9 investigations, often referred to as COP9 investigations, are reserved by HMRC for cases in which a considerable loss of tax is suspected. They are the most serious civil investigations undertaken by HMRC and involve highly trained Fraud Investigation Services (FIS) officers.

COP9 investigations essentially involve HMRC agreeing not to pursue a criminal prosecution against the taxpayer in exchange for them admitting their dishonesty and paying all unpaid tax and financial penalties.

  • Criminal powers

HMRC reserve their right to pursue criminal investigations in all cases of tax evasion. Some civil cases may become criminal if the extent of dishonesty or the amount of unpaid tax discovered warrants such action as the matter unfolds. However, they generally only invoke their criminal powers in the following specific cases:

  • When particularly serious fraud is suspected

HMRC will likely launch a criminal investigation when the suspected tax fraud is deemed to be particularly serious, such as when organised crime groups are involved

  • When HMRC want to send a deterrent message

 Sometimes, HMRC may be keen to send a warning shot to specific customer groups or those operating in certain business sectors. This may be due to them cracking down on a particular illegal tax scheme, or an industry in which tax fraud is known to be rife.  By pursuing criminal investigations against dishonest individuals and businesses in those situations, HMRC aims to reassure honest taxpayers that they are not at a disadvantage by virtue of their honesty and discourage others from tax fraud.

  • When HMRC’s civil powers are inadequate

HMRC typically uses its criminal powers in cases involving considerable and deliberate dishonesty. Some cases of tax fraud may be so sophisticated or extensive that HMRC’s civil powers are not far-reaching enough to enable them to sufficiently uncover and address it. For example, they may need to obtain search warrants to obtain the information and documentation required to assess the full extent of the illegality. In these cases, HMRC may initiate criminal proceedings.

If you are convicted of a criminal offence for tax evasion, the possible penalties include a fine and imprisonment.


What does a Tax Fraud Lawyer do?

If you are facing allegations of tax fraud, having an experienced tax fraud lawyer by your side is invaluable. Your tax fraud lawyer will protect your position to the fullest extent possible, negotiating the most lenient penalty available in the circumstances.

Examples of the types of work a tax fraud lawyer typically undertakes include the following:

  • Investigating the circumstances of your alleged tax fraud and advising on the implications.
  • Explaining HMRC’s likely course of conduct, how long it will last, and the possible outcomes.
  • Attending any HMRC investigations with you.
  • Negotiating with HMRC on your behalf with a view to securing the most moderate penalty possible.
  • Preparing your defence to civil or criminal proceedings.
  • Appealing HMRC decisions.
  • Representing you in Court and Tax Tribunal proceedings


How can our Tax Fraud Lawyers help?

Our specialist HMRC team is comprised of extremely able expert tax fraud lawyers whose decades of experience in the field make them ideally placed to defend clients facing tax investigations and allegations of tax fraud. We have an outstanding track record of successfully resolving tax fraud matters on behalf of our clients before civil or criminal proceedings are issued, enabling our clients to move on and recover from the experience as quickly as possible. If HMRC are intent on pursuing litigation, our tax fraud lawyers will ensure your defence is as comprehensive and watertight as possible and work tirelessly to secure a favourable outcome. We understand that facing a tax investigation can be an incredibly stressful experience, and we will be by your side throughout, helping you navigate and understand each stage of the process.

For a confidential free discussion, call us today on 01908 414990,  alternatively email us at or complete our Free Enquiry Form and we will call you back.