Can HMRC Open Up More Years For Investigation?

There is a strong chance that your initial enquiry will drag on for more than a year. This means that you will make one tax return while the investigation is ongoing.

HMRC can open that year for investigation without needing to provide any sort of justification. But if they want to open up earlier years they will need to have made some sort of ‘discovery’.

Broadly speaking HMRC needs to have found something that is the result of at the very least “careless’’ behaviour, or that “when the time limit for issuing a notice of enquiry into the return passed, or the enquiries were completed, the officer of the Board could not have reasonably been expected, on the basis of the information made available to him, to be aware of the situation.’’

Let me translate that for you:

…when the time limit for issuing a notice of enquiry into the return passed, or the enquiries were completed

This is a year after you submitted your tax return.

the officer of the Board

That’s HMRC

could not have reasonably been expected, on the basis of the information made available to him, to be aware of the situation.

Did you provide enough information to HMRC about your tax returns to give them a clear picture of what you were doing or have HMRC discovered something it could not have reasonably been expected to have known at the start of the investigation?

If HMRC can answer yes to this question then there is a good chance they can claim a discovery and open up earlier years.