HMRC investigations explained: what to expect and how to respond

Authors: Neena Jhawer, Senior Consultant – Crime, Business Crime and Investigations and Nicholas Doran, Consultant Solicitor Advocate | Last updated: 10th June 2026

Article summary: HMRC investigations have risen sharply since 2024 and can escalate from a routine compliance check to a criminal enquiry without obvious warning. Civil investigations may proceed under Code of Practice 8 (complex tax avoidance) or Code of Practice 9 (suspected fraud), both of which carry significant consequences. Early legal advice is critical. Casual responses or poorly managed disclosures at the compliance check stage can limit your options later.

Are you being investigated by HMRC? 

HMRC investigations have increased by more than 60% since 2024. Whether civil or criminal, these enquiries are complex and potentially carry high stakes. Understanding the process and acting swiftly is essential, and obtaining HMRC investigation legal advice at the outset can be decisive. 

Neena Jhawer and Nicholas Doran from Setfords Solicitors combine legal expertise with strategic insight to guide clients through every stage of an HMRC investigation. From initial enquiries to complex criminal or civil defence, they ensure that your position is protected and your case is handled with precision and care. They offer focused HMRC compliance check help and HMRC investigation legal advice tailored to the facts of your case.

When HMRC makes contact

Few letters land with quite the same weight as one from HMRC. Even where the opening correspondence appears measured and administrative, the effect is often immediate: uncertainty, anxiety and a pressing need to understand what the enquiry really means. For many people, the first question is whether HMRC is simply checking the accuracy of a return or whether something more serious is beginning to unfold. Seeking HMRC investigation legal advice at this stage can clarify your position and secure practical HMRC compliance check help before missteps occur. 

Civil investigations: how they begin

In many cases, an HMRC investigation begins as a civil enquiry. It could be as a result of an anonymous tip-off, a risk-based flag, or by way of random selection. This does not necessarily mean the matter is minor, but it does mean HMRC is initially focused on establishing whether the right amount of tax has been declared and paid.  

The process can involve requests for documents, explanations and further information. In more complex situations matters may proceed under: 

• Code of Practice 8: used for complex tax avoidance cases, where early Code of Practice 8 tax advice can shape the strategy and evidence presented
• Code of Practice 9: used where fraud is suspected, and should never be approached without a specialist Code of Practice 9 lawyer providing robust guidance

Code of Practice 9 is particularly significant.  

Although it is used where HMRC suspect fraud, it still leaves open the possibility of resolving matters through a full and carefully managed disclosure and alternative dispute resolution rather than through prosecution. Engaging a Code of Practice 9 lawyer early, like Neena and Nicholas, ensures the disclosure is properly structured and your rights are protected, while targeted HMRC compliance check help can keep civil aspects on track.

When civil becomes criminal

The distinction between civil and criminal matters is one that can become critically important. HMRC may decide that a case should be investigated criminally where it believes there has been deliberate concealment, false documentation, misleading statements or evidence pointing to wider dishonesty. At that point, the tone and consequences of the matter change considerably. What may have begun as correspondence and requests for information can give way to interviews under caution, search warrants, production orders and, in some cases, restraint or confiscation proceedings. In these circumstances, immediate HMRC investigation legal advice can be vital to manage risk and preserve defences.

Why early advice matters

What makes these situations especially difficult is that the point of escalation is not always obvious at the outset. A matter described as a “compliance check” may still carry significant risk if responses are given too casually, records are produced without thought, or assumptions are made about the seriousness of the enquiry. Access to HMRC compliance check help ensures responses are accurate, proportionate and aligned with your broader legal position.  

By the time HMRC’s concerns are clearer, important opportunities to protect your position may already have been lost. For that reason, the early stages of any enquiry often matter far more than they first appear to. Code of Practice 8 tax advice at this point can guide the scope of disclosure and negotiations, while a Code of Practice 9 lawyer can help you assess the merits of the Contractual Disclosure Facility and any parallel civil considerations.

Early strategy, better outcomes

Civil and criminal investigations follow different paths, but both demand careful judgment from the beginning. The right advice at an early stage can clarify the nature of the investigation, preserve important rights and shape the way the matter develops, often making a significant difference to the outcome. Our team provides clear HMRC investigation legal advice, dedicated HMRC compliance check help and targeted Code of Practice 8 tax advice to reduce exposure, manage deadlines and position your case for the most effective resolution. 

If you have received a letter from HMRC, are facing a compliance check, or have been approached under Code of Practice 8 or Code of Practice 9, contact us for immediate support. Speaking to a Code of Practice 9 lawyer or a specialist in Code of Practice 8 tax advice at the outset can protect your interests, and our HMRC investigation legal advice will help you respond confidently and strategically.