A man receives a brown envelope. Inside is a letter saying his return for a particular year is being checked, and asking for records.
He has done nothing wrong. He does not know that. He spends four days convinced he is about to be prosecuted, tells nobody, and by the time he calls an accountant he is in a considerably worse state than the letter warrants.
1. Open by separating an enquiry from an accusation
An enquiry is a request for information. It carries no finding, no presumption and no penalty in itself. Saying this in the first sentence of any response is the single most useful thing an accountancy firm does, because the person reading it has already spent a week assuming the opposite. The letter is written in formal language that does nothing to correct the impression.
2. Explain that selection is frequently routine
Some enquiries follow a specific concern and a great many do not. Random selection exists, sector reviews exist, and a figure that simply looks unusual against an industry norm can prompt a look. None of this means somebody has done anything wrong, and knowing it changes how somebody sleeps.
3. Explain the types of enquiry
A check into one item is a very different matter from a full review of a return or a wider examination of a business. The letter usually says which, and people cannot tell. Explaining the difference tells somebody in a minute whether this is an afternoon's work or a long process.
4. Say what should happen immediately
Do not reply alone, do not send anything in haste, note the deadline and get the letter in front of somebody who reads these regularly. People either panic and over disclose or freeze and miss a deadline, and both make the position worse than it needed to be.
5. Explain the deadline and the extension position
There is usually a date for a response and it is usually possible to request more time where records take gathering. People assume the date is absolute and either miss it or send an incomplete response to meet it.
6. Set out what records will be needed
Bank statements, invoices, receipts, mileage records and anything supporting the figures under question, which is the ground covered in what records do I need questions. Knowing the list converts a vague dread into a task.
7. Explain what happens where records are incomplete
It happens constantly and it is not fatal. Reconstruction from bank records, supplier statements and reasonable estimates is normal practice. Somebody who believes missing receipts mean automatic disaster needs telling otherwise.
8. Explain the likely outcomes honestly
No change, a small adjustment, a larger adjustment with interest, or penalties where there has been carelessness or worse. Setting out the range, with the likelihood, is more reassuring than a vague promise that it will be fine.
9. Explain how penalties actually work
They depend heavily on behaviour and on whether somebody came forward. Cooperation and disclosure reduce them substantially. This is the strongest argument for engaging properly rather than resisting.
10. Explain the professional cost
An enquiry takes professional time regardless of the outcome, and that time is chargeable. People are frequently more shocked by this than by the tax, and it should be stated at the outset.
11. Explain investigation cover
What it covers, what it costs, and that it generally has to be in place before a letter arrives. Anybody with several income sources or a business should hear about this while they still have the option.
12. Cover the offshore and residency cases specifically
These attract particular attention and carry their own rules, which is the ground covered in overseas income and residency questions handled carefully.
13. Encourage disclosure before a letter arrives
Somebody who knows there is a problem is in a far better position coming forward than being found. This is the most valuable advice available and it is only useful before the envelope lands.
14. Handle the enquiry with some care
Somebody asking about investigations is frequently embarrassed, which is the same barrier described in adult enquiries and the self consciousness barrier. The tone of the first reply decides whether they call at all.
15. Capture the right detail at first contact
Which year, what type of enquiry, what the deadline is and what income sources exist, which is the screening described in receptionist screening questions.
16. Answer at the hour the envelope is opened
An assistant that explains what an enquiry is, what it is not, what the deadline means and what to gather reaches somebody on the evening they open the letter rather than four frightened days later. See features, start at try, and the sector view sits under accountants.