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HMRC Code of Practice 9 has been updated to take account of the new appeals process and penalty regime that came into force on 1 April 2009.

HMRC will investigate any situation where they suspect serious tax fraud. The investigation will be undertaken with or without the tapxpayer's voluntary co–operation. However, if the paxpayer does co–operate, HMRC say that the investigation will proceed more quickly, efficiently and advantageously for both parties than if the taxpayer refuses to co–operate. Code of Practice 9 is designed to help the taxapyer make an informed decision on co–operation by setting out how HMRC carry out such investigations and how, through full co–operation and disclosure of irregularities, the taxpayer may achieve a significant reduction in any penalty found to be due.

The Code of Practice covers direct taxes, including income taxes, Corporation Tax, Capital Gains Tax and National Insurance contributions and indirect taxes including VAT and Excise and Customs duties.

HMRC state they will keep an open mind to the possibility that there may be an innocent explanation for the suspected irregularities. They also undertake to treat taxapyers fairly and courteously and in accordance with the law.

The new version of COP 9 is available on the HMRC website at http://www.hmrc.gov.uk/leaflets/cop9-2009.htm.