What is COP8?
COP8 is a process which HMRC uses to investigate complex tax issues. Often this involves Bespoke Tax Avoidance Schemes, high value transactions, or potential additional taxes arising from tax residence or tax domicile errors.
What are the stages of COP8?
HMRC will notify you that they intend to investigate your affairs under COP8 and invite your co-operation with their enquiries.
It is likely that HMRC will have already received information which indicates potential errors in your tax returns - HMRC may or may not share this information with you in their opening letter.
Under COP8, HMRC will conduct information gathering to assist their understanding of your circumstances and the information gathering may continue throughout the enquiry.
HMRC will likely invite you to an initial meeting where they will often outline their concerns and question you about your past tax affairs - such meetings can be lengthy and wide ranging.
Ultimately, HMRC will either agree your tax position is correct, or seek to recover further taxes, interest and penalties.
COP8 enquiries are not commonplace and typically result in six figure tax settlements, hence seeking expert advice from specialists such as inTAX is highly recommended.
What if I refuse to co-operate with COP8?
HMRC will investigate using their information powers and, if they confirm additional taxes are due, then you will likely pay a higher penalty, in addition to the tax and interest HMRC will demand.
If HMRC discovers evidence of fraud during their information gathering process, then they may upgrade the enquiry to COP9, or commence a criminal investigation.
Will I pay a penalty as well as tax if I have COP8?
For any deliberate errors then yes, a penalty will be payable. The amount depends on the behaviour and your level of co-operation, as well as whether the issue is onshore or offshore.
When the inTAX team helps a client with COP8, we will argue for the lowest possible penalty that can reasonably apply to their situation.
Should I seek specialist advice if I receive a COP8 letter?
Yes, if you have been notified that HMRC are investigating your tax affairs under COP8, then HMRC will expect you to seek expert advice from a specialist such as inTAX. Our team has helped many people successfully conclude COP8 enquiries and the team has decades of experience in COP8 work, so you will be in good hands.
How InTax can assist you with a COP8 tax investigation?
The inTAX team can guide you through the COP8 process and act as your representative and agent, ensuring you have minimum contact with HMRC and safeguarding your best interests. We aim to settle any tax disclosure within a timescale to suit you and on the best terms possible.
