HMRC can select any taxpayer at random and the risk of being selected will depend upon your individual circumstances. These investigations will range from a simple request for information right through to an investigation into all your business and personal finances.

HMRC can impose penalties for inaccuracies where additional tax is due. The severity of any penalty depends on whether the discrepancy was deemed careless or deliberate.

Investigations are, by their nature, intrusive, expensive and can last months - or even for many years.

Yes, anyone who is required to fill in a self-assessment tax return can purchase Tax Defence.

HMRC takes a risk-based approach, using data and analytics to identify discrepancies. Random checks can also occur, making it crucial for taxpayers to maintain accurate records. Discrepancies in tax returns, large fluctuations in income, and information received from third parties, such as online platforms and payment processors, can trigger an investigation.

HMRC may request a wide range of documents, including bank statements, invoices, receipts, and expense records. Having comprehensive and organised records helps you to protect yourself in case of an investigation.

For more details, refer to Gov.uk.

Unfortunately not. HMRC also gathers data from banks and payment processors (by credit/debit card). So, whether you have a part-time business, childmind or even run a stall at the local farmers’ market, any transactions can be investigated

Any trade or profession can benefit from Tax Defence. Whether you are in business or are an individual - so long as you file a tax return, you are at risk. Typical businesses and kinds of people that benefit from Tax Defence include:

• Manufacturers
• Retail businesses
• On-line sellers
• Restaurant/takeaways
• Taxi drivers
• Healthcare providers
• Publicans
• Construction businesses
• Farming businesses
• Arts/entertainment providers
• Professionals
• High-net-worth individuals

We’ll guide you through the quote process. Here are some of the key details about your activities and income that we’ll need to know:

• What type of business you are (Company, Partnership or Sole Trader)
• Your last declared business turnover
• What personal income you declared on your last Tax Return
• What profession or trade are you in

Your turnover will affect the risk profile and possible complexity of an HMRC enquiry. If you have not previously submitted a tax return, you should use your projected turnover for the coming 12-month period. You should include income from all sources, including rental income, proceeds of any capital gains, any overseas income and other investment income.

Although overseas income is used to determine your turnover band, please note that the Policy will not provide cover for any tax enquiry conducted outside of the UK by an overseas tax authority into the overseas income.