REMEZ & PARTNERS

HMRC compliance checks

A compliance check is HMRC formally reviewing a return or your records — an enquiry has been opened, unlike a nudge letter. Establish the scope of the check before sending anything, do not agree to an informal meeting without representation, and appoint an agent so HMRC corresponds with them rather than telephoning you.

The letter is formal, the tone is neutral, and the instinct is to be helpful immediately. That instinct is the expensive one: almost every avoidable cost in an enquiry comes from answering more than was asked, early.

The first 48 hours

  1. Read what is actually being checked. One year, one figure, one claim — or everything. The letter says, and it is often narrower than the anxiety suggests.
  2. Diary the response date, usually 30 days, and ask for an extension early if the records will take longer. Extensions are routinely granted; missed deadlines are not forgiven.
  3. Do not send anything yet. Not the bank statements, not an explanation, not a helpful summary.
  4. Get it read by someone who has seen enquiries before, and appoint them as your agent.
  5. Then respond — completely, within scope, in writing.

Why scope is the whole game

A check opened into one year's expenses is not an invitation to review five years of everything. But an answer that volunteers information about another year, or another income source, can widen it — and once widened it does not narrow again.

The letters are written to be answered fully. Answering fully within the scope asked is right. Answering the question behind the question, helpfully, is how a four-week check becomes an eighteen-month one.

The meeting

HMRC often suggests an informal discussion. It sounds like a shortcut and it usually is not: answers given from memory, without records, become part of the record, and an inaccurate answer given honestly still damages the behaviour characterisation that decides the penalty. Written responses can be checked first.

Let HMRC deal with us instead

Once we are appointed, the correspondence and the calls come to us. We establish what is genuinely in scope, prepare the response, and argue the behaviour characterisation — which is where the money is. Fixed fee agreed before we start.

Or send an email

Free assessment first. If there is work to do, you get a fixed quote in writing before anything starts.

What it can cost, and what decides it

  • The tax, if an adjustment is due — and sometimes none is.
  • Interest from the original due date.
  • A penalty, as a percentage of the tax, set by whether the error was careless or deliberate and whether the disclosure was prompted or unprompted.
  • The number of years opened, which turns on the same behaviour judgement: 6 years against 20 years.

Two of those four are arguments rather than arithmetic. That is what representation is for — and it is why the fee is usually a fraction of the difference it makes.

If something really is wrong

Say so early, through the right route. A disclosure made during a check is prompted, which costs more than one made before — but far less than an error found by HMRC and characterised without your input. Seemaking a disclosure, and if it concerns rental income, theLet Property Campaign.

Questions people ask

What is a compliance check?

HMRC formally reviewing a return, a claim, or your records. It is more serious than a nudge letter — an enquiry has been opened — but it is not an accusation, and most end with either no change or a modest adjustment.

Why me?

Sometimes data: a figure out of line with the sector, information from a third party, an unusually large claim. Sometimes it is random. HMRC does not have to tell you which, and the answer rarely changes what you should do next.

Do I have to give them everything they ask for?

You must provide what they are legally entitled to, which is not the same as everything mentioned in a letter. Establishing the scope of the check before sending anything is the single most valuable step, and it is why sending the file by return of post is the classic mistake.

Should I agree to a meeting?

Not without representation and not without knowing what it is for. An informal conversation produces answers from memory, unverified, that then form part of the record. Written responses can be checked before they are sent.

How long does it take?

Weeks for something narrow, many months for a full review. Responding promptly and completely shortens it more than anything else; drip-feeding information extends it and tends to invite more questions.

What can it cost?

The tax, interest, and a penalty based on behaviour — careless or deliberate, prompted or unprompted. And the scope: how many years are opened turns on that same behaviour judgement, 6 years against 20 years.

Figures are for the tax year shown and change every April. They are general information, not advice — we check the current position for your circumstances before anything is filed.

Reviewed 19 October 2026.

Part of our work on hmrc letters and disclosures — if you want someone to take it off your hands, start with our what your HMRC letter means page.