Discovery Assessment HMRC – Signpost

Discovery assessment HMRC – signpost

Introduction

Welcome to our Signpost relating to HMRC discovery assessments. This provides a link to a number of articles we have put together on the subject…

Our detailed articles are as follows:

What is discovery assessment?

A “Discovery” is a power held by HMRC that allows it to reopen closed periods. In this regard, it differs from an ‘enquiry’ in that an enquiry is an investigation in to ‘open’ years.

As such, there are strict conditions that apply restricting the situations in which HMRC may raise such an assessment.

When can HMRC make a discovery?

This article sets out in detail the scenarios in which HMRC may raise a discovery assessment.

How to prevent a discovery assessment

This article sets out the scenarios in which HMRC cannot raise a discovery assessment and therefore how one might protect oneself from a discovery assessment.

Careless and deliberate behaviour

This article sets out the relevance, and meaning, of careless and deliberate behaviour for the purposes of discovery assessment.

Staleness

It should be noted that, following the Supreme Court’s decision in May 2021, the concept of ‘staleness’ is not recognised for the purposes of discovery assessments. For more information, see here.

The concept of staleness is a developing one. Broadly, it applies where HMRC has failed to act promptly on their discovery. Where this is the case then the assessment may be invalid.

Raymond Tooth v HMRC 

It should be noted that, following the Supreme Court’s decision in May 2021, the concept of ‘staleness’ is not recognised for the purposes of discovery assessments. For more information, see here.

This article analyses this important case in relation to discovery assessment powers.

What do I do if a HMRC make a discovery

This sets out some of the things to consider if HMRC do send you a discovery assessment.

If you receive a letter from HMRC where they are raising a discovery assessment then you must take action immediately. In the first instance you may look at appeal this discovery assessment and normally the time limit for doing so to HMRC is 30 days. Late appeals may be accepted by HMRC but, if not, you will need to appeal to the First Tier Tribunal.

We would recommend that if you receive such an assessment from HMRC that you speak to a specialist adviser without delay.

If you, or your clients, have received a discovery assessment or have any queries about discovery assessment, then please do not hesitate to get in touch.