Is HMRC's enquiry valid?

This article is based on our response to a Readers’ forum query in Taxation. Our response was published on 24 November 2025.

The question: HMRC issued letters stating that is was making enquiries into the 2006 to 2008 tax years under the terms of code of practice 8 (COP8). There was no mention of the enquiry legislation. HMRC also opened enquiries into later years where the enquiry legislation was specifically referenced.

Is HMRC’s enquiry into the 2006-2008 tax years valid?

The question also referenced the tax case Tinkler ([2021] UKSC 39) and asked whether HMRC may rely on that case in court if it appeared that the enquiries into 2006-2008 were invalid.

Our response: Case law has confirmed there is no statutory formal wording as to the notice of enquiry. However it must be sufficiently clear for the taxpayer to understand.

“It seems to me that the purpose of the notice to be given is to warn the taxpayer that an enquiry is underway so that he knows questions may be asked and that time limits may be affected, and to provide a mechanical activation of the enquiry procedure.” Flaxmode Ltd v. HMRC [2008] STC (SCD) 666.

In this case, it seems clear to us that HMRC is looking into the return under CoP8, which describes HMRC’s practice in respect of an investigation; this does not mean an enquiry has been opened under “enquiry” legislation, just that HMRC is asking questions about the return, which they were entitled to do subject to time limits for assessment. It is important to understand that tax enquiries are different to investigations carried out with a view to raising assessments. The rules, processes and timelines are separate.

We agree that “any enquiry allegedly opened with a COP8 letter and no statutory reference is invalid” in that it is not a valid enquiry under enquiry legislation.

According to Flaxmode, “the purpose of the notice… is… so that he knows questions may be asked and that time limits may be affected”. The time limits depend on the type of investigation so it is essential for HMRC to make it clear what type of investigation it is carrying out.

The correspondence referred to does not in our view give the taxpayer any reason to suspect that this is an enquiry and in fact makes it clear there is an investigation under CoP8 and the relevant time limits are those for assessments. HMRC therefore has 4, 6 or 12 years to raise an assessment depending on whether there is deliberate of careless behaviour and whether the under-declaration relates to UK or overseas assets.

In Tinkler, the court determined that the doctrine of estoppel applies where both parties treated the enquiry as valid, despite the notice having sent to the incorrect address. It was clear from the letters (also sent to Mr Tinkler’s adviser) that HMRC was raising an enquiry under S9A.

Here, Tinkler would not apply as the validity of the enquiry is not being questioned – in our view it is clear HMRC opened an investigation into the tax return under CoP8 – rather the type of enquiry (and therefore applicable time limits for assessment). Should assessments now be raised into 2006-2008, HMRC would be asserting deliberate behaviour. The question would be whether the client acted deliberately, not whether the doctrine of estoppel applies. Of course this assumes that the client’s ‘behaviour’ has not been discussed previously.

If the adviser and their client have continued to correspond with HMRC and provide information outside the relevant time limits, then HMRC may argue that the doctrine of estoppel applies in that both parties agree there was deliberate behaviour. However at Tribunal, this would still be for HMRC to prove.

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