Schemes & offshore
Used a tax scheme or offshore structure? Act before HMRC does.
COP8 investigations often focus on avoidance arrangements, offshore assets and complex structures. Getting advice early gives you more options and can lower penalties.
Who this is for
If any of these describe you, it is worth understanding your position before HMRC writes.
Marketed avoidance schemes
You used a scheme that was sold to you, often with a tax advantage certificate or a promoter's assurance that it worked.
Offshore trusts and companies
Assets or income held through a trust, a company or a foundation outside the UK, whether or not anything has been paid out to you.
Overseas accounts or property
Bank accounts, investments or property abroad that have produced income or gains, including those bought with money you have already brought back.
Complex remuneration or loans
Loans, discounts or benefits from a trust or company instead of salary, sometimes described as a way to take money out of a business.
Anyone who has had a 'nudge' letter
HMRC sends standard letters about offshore income and gains. They are not an enquiry, but they are a clear sign HMRC has information about you.
Why HMRC is looking
Arrangements that once looked private are now visible from several directions at once.
International data sharing
Tax authorities exchange account and income information automatically. Many offshore jurisdictions now report UK residents' balances and earnings to HMRC each year.
HMRC's Connect data system
Connect brings together records from banks, employers, companies and land data, then flags accounts and lifestyles that do not match the tax returned.
Scheme disclosure rules
Promoters must tell HMRC about many schemes, and users must report them on their tax returns. HMRC therefore knows who was involved, often years before it writes.
Growing information powers
HMRC can ask banks, advisers and third parties for information, and can seek overseas data through formal requests. The gap between what it can see and what you assume it can see is wide.
Why acting first matters
Penalties are lower when a disclosure is unprompted — that is, when you come forward before HMRC opens an enquiry or sends an information request. Once HMRC has written, the same facts usually cost more, take longer and leave you with fewer options.
Coming forward early can also reduce the chance of the case being treated as deliberate, which affects both the penalty and how far back HMRC can look.
If you used a tax avoidance scheme
- Accelerated payment notices
- HMRC can demand the disputed tax up front, usually within 90 days. There is no appeal against the notice itself, but you can make representations to HMRC within those 90 days.
- Follower notices
- These are issued where a court has ruled against a scheme in someone else's case and HMRC considers that ruling applies to your arrangement too.
- DOTAS scheme reference numbers
- Under the Disclosure of Tax Avoidance Schemes rules, promoters must register certain schemes with HMRC, which issues a reference number that users must report, so HMRC can see who has used what.
- The General Anti-Abuse Rule (GAAR)
- A rule that lets HMRC counteract arrangements it considers abusive, even where they appear to work under the letter of the law, and can carry its own penalty.
What we do
- 1
A confidential review of the arrangement
We read the documents, understand what you were sold and what you actually did, and tell you plainly where the exposure sits.
- 2
An assessment of your exposure
A realistic view of the tax at risk, the years involved and how HMRC is likely to classify behaviour — the factor that drives both penalty and time limits.
- 3
Preparing a complete and accurate disclosure
Coming forward can mean a lower penalty and more control over the process. We help you correct your tax position through a complete and accurate disclosure of your full position.
- 4
Managing any HMRC contact
If HMRC has already written, we can act for you and take over the correspondence, so nothing is said or signed without being thought through first.
Common questions
HMRC hasn't written to me. Should I still say something?
Possibly. A disclosure made before HMRC opens an enquiry is usually treated more favourably than one made after it starts, and it can reduce the penalty as well as the years in scope. Specialist advice helps you establish and correct your full tax position.
The scheme was sold to me as legal. Doesn't that count for something?
It can. What you were told and by whom is relevant to how HMRC classifies your behaviour, which is the main driver of penalty levels. It is not a defence on its own, and it is why your original paperwork matters.
Will coming forward mean admitting I did something wrong?
A disclosure is a way of correcting your tax position with HMRC. It is not a criminal plea. Your disclosure must be complete and accurate. We help you establish the facts and present your full position clearly from the start.
The structure is complicated and the adviser who set it up is no longer around.
That is common and workable. We reconstruct what you can from bank records, filings and correspondence, and we tell you what is missing rather than guessing on your behalf.
Is this the same as a COP8 investigation?
Not yet. COP8 begins when HMRC's Fraud Investigation Service writes to open a civil investigation into the accuracy of your tax position. Advice now is about where you stand before that letter arrives.
Confidential consultation
Speak to a COP8 specialist before you reply to HMRC
What you say and sign in the first weeks shapes how a Code of Practice 8 investigation unfolds. Tell us what you have received and we will talk you through your options, in confidence and without obligation.
Not ready to talk? Take the 2-minute COP8 risk check
- ICAEW Chartered Accountants
- Strictly confidential
- Specialist in HMRC investigations
- We'll call you within 2 hoursOutside office hours? We'll call you by 11am the next working day.