HM Revenue and Customs investigations and disputes

Markel Tax

As a member of the AOP you are automatically provided with Tax/VAT investigation cover as a right of membership.

The benefit is provided by Markel Tax and operates on an appointed representative basis. A Markel Tax investigation specialist will be appointed to deal with a HMRC enquiry on behalf of a member. All investigation specialists are employed by Markel Tax and are either ex-inspectors of taxes or VAT officers and so are well versed in dealing with HMRC enquiries.

The full policy is available on request but detailed below are the main areas of cover and policy exclusions.

What is insured?

• A HMRC full or aspect enquiry into a Corporation Tax Return
• A HMRC full or aspect enquiry into a Partnership Tax Return
• A HMRC full or aspect enquiry into a Sole Trader Tax Return
• A HMRC full or aspect enquiry into a Personal Tax Return
• A VAT dispute arising from an inspection or on receipt of a written notice or assessment from HMRC
• A PAYE dispute following an employer compliance visit
• An IR35 dispute where HMRC challenge the status of a contract for services and seek to invoke the IR35 legislation
• Requests for information and/or documents following a VAT control visit but prior to a dispute
• Requests for information and/or documents following an Employer Compliance visit but prior to a dispute
• An inspection undertaken by HMRC to ensure compliance with the National Minimum Wage Act
• An enquiry into Capital Gains Tax
• An enquiry conducted by HMRC under their Code of Practice 8 procedures (Fraud and Avoidance), £5000 limit of indemnity
• Receipt of a written notification from HMRC of their intention to amend a Self Assessment return, to correct an error, without undertaking an enquiry
• A check of Coronavirus Job Retention Scheme (CJRS) claims
• A check of Self-Employed Income Support Scheme (SEISS) claims

The limit of indemnity in respect of any claim is £100,000 for all enquiries other than those conducted by HMRC under their Code of Practice 8 procedures.

What is not covered?

• Enquiries and Disputes occurring prior to or existing at the time of joining the AOP
• HMRC Specialist Investigations, Civil Investigations of Fraud, Criminal Investigations Sections, Fraud Investigation Service, Counter Avoidance Sections and Code of Practice 9 cases
• Where there is no reasonable prospect of challenging HMRC in VAT, PAYE & IR35 disputes
• Claims arising where the annual Returns/accounts are submitted more than 90 days outside of the statutory time limits
• Claims arising where there has been a failure to notify/register for tax or VAT
• Enquiries and Disputes following a voluntary disclosure of irregularities made to HMRC
• Taxes, fines, interest or any other duties or penalties payable to HMRC
• Compliance costs associated with the routine submission of Returns and third-party valuations
• Enquiries into tax planning arrangements where HMRC have allocated a Disclosure of Tax Avoidance Scheme (DoTAS) Number and/or bespoke tax planning arrangements outside of the normal trade
• A dispute relating to the payment of National Minimum Wage
• Professional expenses incurred in reviewing and/or collating business records in advance of a PAYE/VAT inspection

At the conclusion of an enquiry or after HMRC has undertaken its review of VAT/PAYE records, the officer must reach a conclusion. This may be due to any of the following reasons:

• That the original Self Assessment was correct and so no adjustments are required
• Some adjustments are required, and these are accepted
• That some adjustments are required which are not accepted such that a dispute arises which may lead to an appeal to a Tax Tribunal

At the point that a dispute arises consideration must be given as to whether HMRC’s position can legitimately challenged. Furthermore, it is in relation to these disputes where the concept of reasonable prospects of success is also relevant.

There should be nothing inherently complicated about the concept of the “prospects of success” when applied to insurance and Markel takes a straightforward approach when it comes to our tax investigations policies.

Markel will continue to support a case where there is a 51% or better chance of successfully defending a member or successfully appealing the decision. The decision to proceed does not require a guarantee of success, but a better than even chance that the defence will be successful.

Contacting Markel Tax

If you want to make a claim under this policy, please contact Markel Tax, quoting your AOP membership number on the details below:

Email: [email protected]
Call: 0370 166 6271

By post:
Markel Tax
One Mitchell Court
Castle Mound Way
Rugby
CV23 0UY