Under the old two department system the Inland Revenue had, in addition to investigators in local districts or area offices, two main investigation units: Special Compliance Office (SCO) and Special Investigations Section (SIS). HM Customs & Excise had the National Investigation Service (NIS).

As part of the merger a new independent prosecuting organisation was formed, Revenue & Customs Prosecutions Office (RCPO). The prosecution work of both old departments was transferred to RCPO, which expects to undertake about 3,000 criminal cases a year. These cases are worked under the Police and Criminal Evidence Act 1984 and anyone receiving a challenge needs immediate specialist tax and legal assistance.

SCO has been renamed Special Civil Investigations (SCI) and will undertake the following types of work:

• Code of Practice 8 (COP8)
  These cases are those where the inspector is not alleging serious tax fraud and typically involve tax planning or avoidance, non-resident companies and trusts, offshore bank accounts or anti-avoidance legislation such as Sections 739 and 776 ICTA 1988. Such cases regularly produce very large settlements.
• Code of Practice 9 (COP9 or Hansard Cases)
  Hansard cases are those where the Inland Revenue are alleging serious fraud and can cover all taxes and all circumstances. Such cases need to be handled very carefully as failure to deal with the issues properly can result in a criminal prosecution. HMRC has recently set up special CIF offices throughout the country to increase their capacity to work this type of case. Find out more about the Civil Investigation of Fraud (CIF) process.

SIS concentrates its main efforts on investigating tax avoidance schemes.  Their intention is to either negotiate a settlement or litigate the issues. Both of these outcomes can be difficult and stressful for any taxpayer, whatever their background.

Large Business Services (LBS) also has two arms, the first and largest deals with the big businesses within the UK and the second with PAYE and NIC inspections at the largest employers in the country. For big businesses, LBS is becoming increasingly pro-active in opening enquiries, pursuing information, issuing information notices and insisting on penalties at the conclusion of an enquiry. Given the size of the businesses involved, relatively small adjustments can still create substantial additional tax liabilities.

Our experience in dealing with all these investigation units, along with the deep technical back up from our colleagues within Deloitte, enables us to assist all types of taxpayer on all types of enquiry from HMRC.