How long does HMRC have to start an enquiry?

22 June 2021
2 min read

Michael Lansdell explains the rules surrounding tax enquiries.

Imagine this scenario: in May, you receive a letter from HMRC, querying a figure on your 2018/19 tax return. But you thought the deadline for such enquires had passed, on January 31, 2021. Where do you stand here, and do you still have to answer the question?

The rules around tax enquires were overhauled, not long after self-assessment was introduced. The ideas was to give HMRC enough time to raise a query on a tax return, without making this period open ended.

Clear-cut rules?
Since 2008, the basic deadline for HMRC to start an enquiry is now 12 months from the date when you submitted your return.

If the letter arrives after the deadline, even if it is dated earlier, HMRC has missed out. So, get in touch with the office that issued it immediately by phone, then follow it up in writing, to confirm this. It will then be down to HMRC’s internal procedures to establish if one of its tax inspectors left it too late.

… not so fast!
But if it was you who submitted your tax return late, or amended it after the normal filing deadline, things do get less cut-and-dried.

If your self-assessment was filed late, the enquiry window is now open for 12 months from the end of the quarter in which you submitted your return. So, for a 2018/19 tax return submitted on May 1, 2020, HMRC’s deadline to start an enquiry is July 31, 2021.

If you amended your return, HMRC’s enquiry deadline is also extended, to 12 months from the end of the quarter in which you filed. But – and this is a key point – HMRC can only enquire into the amendment, not any other aspect of your tax return.

So, for a 2018/19 tax return submitted on July 1, 2019, with one entry amended on January 1, 2021, HMRC can start an enquiry into this amendment only up to January 21, 2022. HMRC cannot start an enquiry into any other figures, unless they relate directly to the amended one.

Confused? Well, no one wants to get a letter from HMRC, and if you’re not entirely sure what the rules are this can make dealing with a potential enquiry even more stressful. At Figurit we are tax experts as well as chartered accountants, and will give you all the up-to-date information and guidance you need. Call Figurit (formerly known as Lansdell & Rose) on 020 7376 933.