HMRC Have Contacted Me. Civil vs Criminal Risk.
An intervention by HM Revenue & Customs requires immediate, careful handling. The distinction between a civil tax inquiry and a criminal investigation is often blurred, and decisions made early on can dictate whether you face financial penalties or criminal prosecution.
The Civil/Criminal Divide
HMRC possesses both civil and criminal investigatory powers. While they generally prefer to handle matters civilly (e.g., via Code of Practice 9), they will not hesitate to pursue a criminal prosecution if they suspect deliberate fraud, particularly if it serves as a deterrent to others.
Early Intervention
If HMRC has contacted you or your business, the immediate priority is to understand the nature of their inquiry before responding.
- Do not assume it's just an administrative error: What appears to be a routine compliance check can rapidly escalate into a serious investigation if not managed correctly.
- Protect your position: Engaging a strategic adviser early allows us to interface with HMRC on your behalf, reducing the risk of you inadvertently making statements that could trigger a criminal investigation.
The Danger of Incomplete Disclosure
In civil processes like COP9 (Contractual Disclosure Facility), you are offered immunity from prosecution in exchange for a full, open, and honest disclosure of all tax irregularities. Failing to provide a complete disclosure invalidates the immunity and almost guarantees a criminal prosecution.
Frequently Asked Questions
My accountant usually handles HMRC. Do I need a lawyer?
If HMRC suspects fraud or if you receive notice of a criminal investigation (such as an interview under caution), you must instruct specialist legal counsel immediately. Accountants are rarely equipped to handle criminal defence strategy, and their communications with you may not be protected by Legal Professional Privilege.
Related Services
Fraud & Financial Crime
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Business Crime
Protecting directors, business owners and professionals facing corporate criminal allegations.
Pre-Charge Representation
Strategic intervention before the Crown Prosecution Service makes a charging decision.
Frequently Asked Questions
Suggested Reading
Understanding Criminal Investigations: A Strategic Guide
The definitive guide to criminal defence in England and Wales for professionals. What to expect, how to protect yourself, and how strategic defence works.
Police Search Warrants: A Strategic Guide for Homes, Businesses and Professionals
A strategic guide to police search warrants in England and Wales: the powers behind a search, what can be seized, privileged and protected material, and why the period immediately after the search may be decisive.
When the Authorities Freeze or Seize Your Money or Property: A Strategic Guide to POCA
A strategic guide to the Proceeds of Crime Act 2002 in England and Wales: cash seizure, Account Freezing Orders, restraint, confiscation and third-party property, and why identifying the precise power comes first.
The wider picture
What else could this affect?
An investigation rarely stays in one place. These are the areas that, depending on the facts, may also need to be considered.
Your financial position
An investigation can create financial pressure or scrutiny that may need to be managed as part of a wider strategy.
Your business
Where you run or own a business, an investigation can create commercial and operational questions that should be assessed early.
Your regulator or professional body
A regulator or governing body may take an interest in the same facts, and whether or when to engage should be considered with advice.
Civil litigation
Some matters run alongside civil claims; how the criminal and civil positions interact should be considered together.
Your reputation
An allegation, even one that is never charged, can create reputational exposure that benefits from a considered, strategic approach.
Your assets
Some investigations raise questions about assets or restraint; where relevant, this should be assessed early with advice.
Before you act
The decision you may be facing next
People in your position often face one of these decisions before anything else. Each one is best made with advice, not under pressure.
Should I provide documents that have been requested?
Should I agree to attend an interview?
Should I seek pre-charge representation now?
A parallel process
If this affects your profession
For accountants and tax professionals, criminal, regulatory and civil questions can arise from the same facts and are best handled together.
Who may become involved
- ICAEW
- ACCA
- CIMA
- HMRC (in parallel)
- Your firm
How it can unfold
- 01A concern, complaint or HMRC enquiry arises
- 02A police or agency investigation may begin
- 03Your professional body may take an interest
- 04Your firm may consider its own position
- 05Civil and criminal questions may run alongside each other
- 06Your continued practice may be assessed
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Do You Require Advice About Your Circumstances?
This material provides general information and is not a substitute for advice about a specific investigation or case.
Craig provides legal services exclusively through Forbes Solicitors. To make an initial enquiry, contact Craig at:
craig.mackenzie@forbessolicitors.co.uk
An enquiry does not constitute an instruction. Forbes Solicitors must confirm in writing that it has accepted the matter before any solicitor–client relationship arises.