Helping business people navigate the complexities of HMRC’s procedures, including Code of Practice 9 or the Hansard procedure (COP9), is part of tax barrister Sarah Woodall’s brief – she has recently been involved in helping business owners take the right steps to deal with a tax fraud they admit to committing.
The couple, who originally came to the UK as refugees, and set up a successful business, despite not speaking English. They took money from the business regularly without declaring it and then found their company being investigated by HMRC for tax fraud.
Officials visited their offices and explained that if they admitted what they had done and cooperated fully, the matter could be dealt with as a civil investigation of serious fraud; penalties would follow and tax would have to be paid back. If no admission was made, a criminal investigation could be launched, a type of case that often leads to a prison sentence.
The couple called on Sarah, whose own extensive experience working at HMRC meant that this was familiar territory for her. She discovered that the officials who had visited had not had a translator with them, so their notes of what the couple agreed to were based entirely on conversations which the couple had not understood at all. She worked with their accountant to establish what they had done and the extent of the problem.
She said: “The husband has cancer and the wife is also very unwell; they have four adult children, who would usually act as interpreters for them if the matter wasn’t so sensitive and private, but without that help, they had not understood what was being explained to them. They were afraid that they would be deported.
“HMRC went in very aggressively, and I know that there is now an internal review of how that was done – I was able, because I know the process very well and I know what is needed, to reduce the fines by 50% and bring the total settlement down from £600,000 to £18,000 in all.”