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COP9 Procedures

COP9 Background

COP9 (an abbreviation for Code of Practice 9) is the procedure by which HMRC investigates situations where it believes that "serious" tax fraud has occurred. Investigations (both COP 9 and generally) are very specialist areas! You need a skilled representative who understands fully all aspects of investigations and who will fight your corner! To understand why, you need to understand first what an investigation is, and more importantly, what it is not.

What an investigation is, is a very serious challenge to your tax situation, regardless whether there are issues that require disclosure. What an investigation is not, is a pragmatic objective test of historical situations and their accuracy. By definition the investigation will involve detailed challenges of many historical situations, almost inevitably throwing up grey areas where clear demonstrable answers do not exist.

It is absolutely vital to understand that HMRC's remit does not require it to conduct an overall objective assessment of your situation. HMRC will test a wide range of situations, sources of funds paid into private bank accounts is just one example. The burden of proof in tax law rests with you and it is for you to satisfy HMRC as to the source of such funds. If you are unable to do so HMRC is entitled to tax you on the funds regardless the source.

It's not all bad however, as the burden of proof is the balance of probabilities, what is the most likely situation. This is where our skills come in and we work as a team with you to identify solutions. Take the following simple example.

The client had banked a substantial amount of cash and when challenged claimed it to have been a casino win, which HMRC would not accept because he did not have any evidence. We investigated the situation and were able to demonstrate;

1. That he was a competitive poker player,
2. That he had played at a casino the night before the cash was banked.

These facts, presented by us, were sufficient to dispose of the matter. As I said this was a very simple example. It makes no difference how complex a COP9 Tax Investigation case is, we will work with you to identify and present solutions.


COP9 Meetings

A frequent concern is the prospect of being questioned by HMRC. Whilst there is a requirement that you cooperate with an investigation, HMRC is not entitled to require you to attend a meeting or be verbally questioned in any way. The requirement to cooperate can be perfectly adequately addressed in correspondence and in meetings between us and HMRC in the unlikely event that such an interaction becomes necessary


Final Decision; Tribunal

Regardless the "aggressive" way in which HMRC presents itself it absolutely does not have the last word in respect of any outcome. The is Tribunal an excellent appeal service, and one that is totally independent of HMRC. Every decision made by HMRC can be challenged at Tribunal and if appropriate overturned. We are one of the country's leading advocates at tribunal.



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Arthur, Debono & Hamilton Forensic Accountants Ltd Registered Office 12 De Clare Close, CF36 3JH, Registered in Wales, 10083898.