Aspect Tax Investigation is an enquiry into specific aspects of a business’ tax return. Aspect Tax Investigations are narrower than the more general Full Tax Investigation and focus on the reassessment of one or more specific areas of the tax return in question.
Aspect Tax Investigations require fewer resources to perform and are less costly than the Full Tax Investigations. Aspect Tax Investigations therefore highlight HMRC’s attempt to become more cost-effective in the face of the government’s’ line of austerity that brings spending cuts and staff reductions across many areas of government, while still implementing tax legislation.
Typically, the outcomes of Aspect Tax Investigations highlight genuine mistakes or misunderstandings by the business or individuals that led to some form of tax evasion, rather than any deliberate attempt to evade tax. However Aspect Tax Investigations should not be taken lightly as they can prompt a further Full Tax Investigation depending on the outcome. Aspect Tax Investigations can be performed on business records as well as any personal records of the directors and/or business owners, as is seen with Full Tax Investigations. The average length of time taken to complete an Aspect Tax Investigations is between 3 and 6 months, however it can take considerably longer in some circumstances.
If you are subject to an Aspect Tax Investigation, it can be a stressful time for you and your business. Do keep in mind the that an HMRC investigation is a commercial move rather than a personal attack on your integrity. It’s important you stay calm and respond to HMRC efficiently and professionally, as this will be advantageous for the general consideration of your means. A tax advisor can offer expert assistance in tax efficiency and dealing with Aspect Tax Investigations to ensure you are complying with tax legislation.