Code of Practice 9 Investigations (COP9)

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Our specialist Code of Practice 9 Investigation team

No other firm in England has such a unique skill set as our tax team.

• Andy Lynch. Andy is an expert on a wide range of HMRC claims and before joining FWJ, he spent 18 years at HM Customs & Excise in their National Investigation Service. His experience is unrivalled in all types of HMRC claims including HMRC investigation defence, VAT claims, R&D tax credit defence, Account Freezing Orders, Tax Disclosure, Code of Practice 8 & 9 claims, winding up petition defence and much more.
• Stephen Downie. Stephen is a Partner and a former ACCA accountant who combines financial expertise with deep legal knowledge to deliver clear, commercial advice. He acts for directors, shareholders, insolvency practitioners and private clients in corporate governance disputes, director disqualification defence, and HMRC-related claims including tax avoidance schemes, PLNs, VAT and PAYE security demands. His focus is always on achieving the best outcome for clients as efficiently and cost-effectively as possible.
• Joshua Goulding. Joshua is a Senior Associate who specialises in complex tax disputes across multiple jurisdictions. Before joining FWJ, he worked for a Big Four accountancy firm and holds an advanced certification in international tax and BEPS from the IBFD. His expertise covers direct and indirect tax disputes, HMRC enquiries, tax treaty matters, restitution claims, and litigation before the Tax Tribunal and higher courts.
• Anita Sharma. Anita is a Senior Associate specialising in tax litigation and financial disputes with HMRC. She advises high-net-worth individuals and major commercial clients on appeals against HMRC decisions, complex tax assessments, and enforcement proceedings. Anita has secured interim relief following HMRC revocations to keep clients trading during appeals and is known for achieving practical, results-focused outcomes in high-value disputes.
• Connor Coombs. Connor is a Paralegal in the tax team assisting on a broad range of HMRC investigation and defence matters. He supports clients with Code of Practice 8 and 9 investigations, time-to-pay arrangements, HMRC statutory demands and R&D tax credit disputes. Connor also helps prepare detailed evidence and submissions for use in appeals and settlement negotiations, ensuring cases are presented clearly and effectively.

Introduction to COP9 investigations

The Code of Practice 9 (COP9) is a process by which HM Revenue and Customs (HMRC) deal with serious cases of suspected tax fraud. The guidance outlines the process through which HMRC investigate and settle tax liabilities when the irregularity has taken place. COP9 is an essential tool for ensuring tax compliance and fairness within the tax system.

Triggering the process and what triggers it

The COP9 process begins when HMRC has reasonable grounds to suspect that a taxpayer has committed tax fraud and or a taxpayer wishes to voluntary disclose tax fraud. Once they have considered an outline of the irregularities, they may invite the taxpayer to participate in the Contractual Disclosure Facility (CDF) process under COP9.

COP9 investigations can begin for a number of reasons, most commonly these are;

• A taxpayer wishes to regularise their tax own position knowing that there are issues and wants to make a voluntary disclosure.
• HMRC is receipt of information which suggests that a taxpayers returns are inaccurate. This information can come from various sources such as foreign tax authorities who have agreed to share taxpayer data with HMRC, information generated from other law enforcement agencies, such the Police, NCA or the FCA, or information received direct from the public.

An increasingly common tactic is for HMRC to issue ‘nudge letters’ encouraging the taxpayer to come forward and make a disclosure. If you receive such a letter, you should not ignore, as HMRC will not away.

Contractual Disclosure Facility (CDF)

The Contractual Disclosure Facility is a fundamental element of COP9, which provides taxpayers with an opportunity to cooperate with HMRC in resolving their tax affairs. When HMRC invites a taxpayer to participate in the Contractual disclosure facility , they offer a contract. By signing the contract, the taxpayer agrees to provide full and accurate disclosure of their tax affairs, including the tax fraud committed. In return, HMRC commits not to pursue criminal prosecution for tax-related offences, provided the taxpayer cooperates fully and makes a full and accurate disclosure.

Disclosure Report

After signing the Contractual disclosure facility contract, the taxpayer must prepare or commission a detailed disclosure report within a specified timeframe. This report should contain all relevant information about the irregularities, the amount of tax underpaid, and any other inaccuracies in previous tax returns. The report should be comprehensive and transparent to benefit from the protection offered by the contractual disclosure facility.

Review and settlement

Once HMRC receives the disclosure report, they will review it carefully. If the report is complete and accurate, and the taxpayer has cooperated fully, HMRC will aim to settle the tax liability. The settlement will typically include the tax underpaid, interest, and penalties.

Penalties

Penalties following a COP9 investigation can be as high as 100% of the tax evaded and disclosed in the report. These penalties are mitigated by various factors such as the quality of the disclosure, an unprompted disclosure, and the time span of the tax fraud.

Rejection of Contractual disclosure facility

If HMRC deems the disclosure report to be incomplete or inaccurate, or the taxpayer fails to cooperate fully, the protection offered by the CDF will be withdrawn. In such cases, HMRC may proceed with formal civil or criminal investigations, leading to higher penalties or even prosecution if tax evasion is proven.

Importance of professional advice

Participating in the COP9 process is a complex and sensitive matter. Taxpayers are strongly advised to seek professional advice from tax advisors or specialists with experience in dealing with HMRC investigations and disclosures. Professional advice can ensure that the disclosure report is accurate and comprehensive, maximising the chances of a fair and manageable settlement.

• the Code of Practice 9 process is an essential tool for HMRC to tackle tax avoidance, whilst offering taxpayers a way to rectify their tax affairs without facing criminal prosecution.
• by cooperating with HMRC and making a full and accurate disclosure, taxpayers can resolve their tax liabilities and avoid more severe consequences. However, navigating the COP9 process requires careful attention and professional guidance to ensure a successful and fair outcome for all parties involved.

Our tax dispute team at FWJ are highly experienced in dealing with HMRC Investigations and COP9 investigations. We can take a lot of the stress and worry away in the process and also help save you money. If you have any such worries, contact our team today for a confidential no obligation chat.

Or contact Partner and ex HMRC investigation specialise Andy Lynch today for immediate help.

Andy Lynch at FWJ was literally a life saver for me. I ran in to some tax issues with HMRC and I suffer from mental health issues as well so I was a complex case. Andy took his time to professionally and accurately layout my case and assist me with finding a resolution. I researched a lot of tax advisers before making my decision and I am glad I did and relieved that I chose Andy and FWJ.

Chris Kitchen

FWJ did precisely what it set out to do. I am extremely grateful for its assistance.

A client who had received a Request for Security from HMRC for a sum that would have caused their company severe financial difficulties. We helped them to have the entire bill withdrawn