HMRC search of credit report

[kas1981]

I got a notification from Experian of unusual activity on my credit report. Having just checked it, I see it's an "unrecorded enquiry by HMRC".

I just wondered if anyone knew if it's normal for HMRC to carry out a search or is this a pre-cursor to a possible investigation?

I have been self-employed for 3 years and don't think, fingers crossed, I would have much to worry about in the case of an investigation, however I don't relish the prospect and would prefer to be on the front-foot.

Would appreciate any views....

[mullet]

I suppose it could be the precursor to an investigation, but it could also be a bank account check anti-fraud) if you were about to receive a repayment.

[wamstax]

Credit reports are one of the "tools" used by HMRC in risking a case for enquiry and unless you have the likelihood of qualifying for a repayment or have arrears that they are thinking about pursuing with vigour I would get your tax returns out that you have completed in the last 4 years and see if there is anything that you could possibly have omitted. For example were you in receipt of "taxed" bank interest that you possibly omitted from your return thinking that it didn't matter as tax had been deducted from it on receipt. Also could you have maybe bought and sold property or let property out - all the little projects that HMRC have been persevering with for the last few years. For other ideas please see http://www.wamstaxltd.com/Articles_of_Interest.html

If you discover something amiss then discuss with your tax adviser/accountant the benefit of going forward to HMRC and either making a voluntary disclsoure or amending any returns still in time for amendment -e.g. 2009-10 tax return can still be amended without any material detrimental effect on your tax compliance up to 31st January 2012.

If all else fails you could of course consider with your tax adviser whether you should perhaps think about taking out HMRC tax Enquiry Insurance cover just in case their risking comes to fruition in the form of the wee buff (but nowadays sometimes white) envelope and save yourself a few pounds in tax fees. Of course I am not marketing or advocating tax enquiry insurance but individuals don't usually get too much warning about tax enquiries beign in the offing