HMRC Compliance Checks in 2026: Records, Rights and How to Respond

What a compliance check means

HMRC can check whether tax returns and payments are correct. The scope might concern one figure, a particular tax or a wider set of records. The opening letter should help identify what is being checked and what HMRC wants. Do not assume every letter is an accusation of fraud or that every check will run for a fixed number of months.

HMRC uses information and risk assessment in its compliance work, but the exact reasons for an individual check may not be public. Unsupported claims about automatic AI selection, the number of data sources, investigation volumes or the likelihood of a check should not drive a response. The actionable issue is the request and the evidence relevant to your tax affairs. See HMRC's compliance-check overview.

First, verify the letter and diary the deadline

Keep the letter, envelope and any electronic messages. Check the taxpayer name, tax reference, tax periods and officer contact details against your own records. If contact is unexpected, verify it using a trusted route rather than following an unfamiliar payment link or disclosing information to an unverified caller.

Note the requested response date and any formal notice deadline. Tell the adviser responsible for the relevant returns and supply the full communication, including attachments. If records cannot reasonably be assembled in time, ask HMRC promptly whether an extension is possible; do not assume it has been granted.

Check whether the request is informal correspondence, a formal information notice, an inspection proposal or a particular investigation procedure. Those distinctions can affect the response obligations and challenge rights. Ask for clarification of an unclear request while continuing to collect the records you know are relevant.

Collect evidence and explain differences

Useful records can include bank statements, invoices, receipts, payroll reports, contracts, stock schedules, accounts and the workings behind filed returns. Preserve the original records and any audit trail. If a return is wrong, document the facts and seek advice about the correct way to disclose or amend it.

Figures on VAT returns, statutory accounts and tax returns do not always match directly. Different periods, accruals, exemptions, private use or tax adjustments can explain a difference. Prepare a reconciliation with the relevant dates and rules rather than changing figures solely to make totals look identical.

For an expense, demonstrate the amount, business purpose, timing and tax treatment. For a director's payment, identify whether it was payroll, a dividend, a reimbursed cost or a loan. For an R&D claim, retain the technical narrative and cost evidence described in our R&D guide.

Representation and information notices

You can appoint an accountant or tax adviser to help, and obtain legal advice where appropriate. A representative can organise the records and communicate with HMRC once authorised. You are also entitled to communicate with HMRC yourself; representation is a choice and sometimes a practical necessity for complex matters.

A formal information or inspection notice can create legal duties and penalties for non-compliance. The available appeal rights and exemptions depend on the type of notice and the information requested. Do not treat a general right to seek advice as permission to ignore the notice. See HMRC's information notice factsheet.

Provide accurate answers within the proper scope and retain copies of the response and supporting documents. If an answer is uncertain, explain the uncertainty and how you will resolve it. Guessing to meet a deadline can create additional problems; a supported estimate must be identified as such.

Time limits and record retention are different

For many Income Tax and Corporation Tax assessments, the normal assessment time limit is four years. Longer limits can apply, including six years for careless behaviour and twenty years for deliberate behaviour or certain failures. Offshore and particular tax rules can produce different periods. The deadline for opening a return enquiry is a separate question.

There is therefore no universal rule that every ordinary check goes back six years. Nor should the assessment period be confused with how long the business must retain records. Check the applicable tax, behaviour, dates and notice. Source: HMRC's assessment time-limit guidance.

Keep records for the statutory period applicable to the business, and retain relevant documents while an unresolved check or appeal requires them. Digital records can help organise evidence, but a cloud subscription does not guarantee the underlying transactions are correct or that every attachment will remain accessible indefinitely.

Tax, interest and penalties

If a check identifies underpaid tax, HMRC may also consider interest and penalties under the relevant rules. A penalty for an inaccurate return depends on matters including reasonable care, careless or deliberate behaviour and the quality and timing of any disclosure. It is not automatic proof of dishonesty.

Review the calculation and the stated grounds rather than accepting or disputing a number without examining it. Keep evidence of the steps taken to prepare the return accurately. See HMRC's inaccuracy-penalty factsheet. No adviser can promise that an enquiry will end without tax or penalties.

Disagreements, review and appeal

If you disagree with a decision, identify the specific appeal rights and deadline stated in the notice. A statutory review or appeal to the tax tribunal may be available. Alternative dispute resolution can help with some disputes, but it does not replace statutory time limits; protect any required appeal while considering ADR.

Explain the factual or legal point in dispute and provide the supporting material. A disagreement about the scope of information requested can involve different rights from an appeal against a tax assessment. Sources: GOV.UK tax appeals and HMRC's ADR process.

COP9 needs specialist attention

Code of Practice 9 concerns suspected tax fraud and the Contractual Disclosure Facility. An offer normally gives 60 days to respond under the process. The contractual protection depends on complete and accurate disclosure of the deliberate behaviour covered by the agreement; it is not a blanket immunity.

Obtain specialist advice promptly before deciding how to respond to a COP9 offer. Review the official COP9 procedure and the actual letter. If the matter involves a different specialist procedure, identify it at the outset so the right adviser can be involved.

For an ordinary check, the useful immediate steps are to verify the letter, preserve the evidence, understand the deadline and agree a response plan. If you have fee-protection cover, review its terms and notification conditions before assuming the cost of representation is covered.

Frequently asked questions

Does an HMRC compliance check mean I have committed fraud?

No. A check is a process for examining whether tax affairs are correct. The scope and any alleged issue should be assessed from the actual letter and notices.

Can I appoint an accountant to respond to HMRC?

Yes. An authorised adviser can assist with records and correspondence. You can also communicate with HMRC yourself; formal information notices still need an appropriate response.

Does alternative dispute resolution stop an appeal deadline?

Do not assume it does. Protect the applicable statutory review or appeal deadline while considering ADR, using the rights and dates stated in the decision notice.

Reviewed against the linked primary sources on 11 October 2026. This guide gives general information; the tax treatment depends on your circumstances and the relevant tax or accounting period.

For support with your records and calculations, see our tax returns service or contact Angel Accountancy to discuss your requirements.