Facing an HMRC enquiry for your restaurant? We answer the same day.

Do not respond to HMRC directly before speaking with a qualified professional. Everything you submit or say to HMRC is recorded and may be used in any subsequent civil or criminal proceedings. Contact a chartered accountant with HMRC investigation experience immediately. Same-day emergency consultations are available. We review the letter, assess the scope of the enquiry, and prepare a measured response that protects your position from the outset. Voluntary disclosure of any historical issues before HMRC writes typically halves the eventual penalty band.

In most civil enquiries HMRC will write to you or your accountant before opening a formal investigation. However, if HMRC suspects fraud, particularly Electronic Sales Suppression (till manipulation), they have powers under Finance Act 2022 Schedule 14 to conduct unannounced visits, inspect premises and remove till devices. Criminal investigations conducted by HMRC's Fraud Investigation Service can also begin without advance notice.

HMRC's discovery assessment windows depend on the nature of the error. The standard window is 4 years from the end of the relevant tax year, extending to 6 years where errors arose from carelessness, and to 20 years where HMRC believes errors were deliberate. For VAT, the standard window is 4 years extending to 20 for deliberate underdeclaration. For restaurants where significant cash is handled and till records are at issue, HMRC will typically open a wider window if they suspect systematic underreporting.

HMRC expects restaurants to maintain comprehensive daily records: till Z-readings and X-readings, all purchase invoices and receipts, complete bank statements, detailed staff records covering payroll, tips and tronc arrangements, all delivery platform statements (Deliveroo, Uber Eats, Just Eat), full VAT records including the working papers behind each return, evidence of any cash payments received, and EPOS daily exports. VAT-registered businesses must retain records for 6 years; sole traders must retain Self Assessment records for 5 years after the 31 January submission deadline. With MTD ITSA Phase 1 LIVE since 6 April 2026, digital records in MTD-compatible software are now mandatory above £50,000 gross income.

Yes. Deliberate tax evasion is a criminal offence under sections 106A to 106B of the Taxes Management Act 1970 (and equivalent VAT and Customs legislation), carrying unlimited fines and up to 7 years imprisonment in serious cases. Electronic Sales Suppression (manipulating till systems to hide income) is a specific criminal offence under Finance Act 2022 Schedule 14, with penalties of up to £50,000 per device plus criminal prosecution. Cheating the Public Revenue, the most serious common-law tax offence, carries up to life imprisonment. Early professional intervention via Code of Practice 9 (the Contractual Disclosure Facility) materially reduces the risk of criminal prosecution by giving the seller a route into civil-only resolution.

Timescales vary widely with complexity. A straightforward aspect enquiry focusing on one issue (a single VAT return, a specific expense category) can be resolved within 3 to 6 months. A full compliance check covering income, expenses, VAT, payroll and platform reconciliation typically takes 12 to 18 months. Code of Practice 9 disclosures run to a structured timetable, with the initial outline disclosure due within 60 days of acceptance and the full report typically within 9 to 12 months. Criminal investigations conducted by the Fraud Investigation Service can extend over 2 to 4 years before reaching trial or settlement. Professional representation from the outset typically reduces the duration because responses are properly prepared and submitted within deadlines.

Absolutely. Since 1 January 2024, digital platforms including Deliveroo, Uber Eats and Just Eat have been legally required to report seller income data directly to HMRC under the DAC7 (Digital Platform Reporting Regulations) regime. The first batch of reports landed with HMRC on 31 January 2025, covering 2024 sales. This data is automatically cross-referenced with your tax returns through HMRC's Connect AI system. Any discrepancies between platform-reported gross sales and your declared turnover trigger automated review workflows. Proper platform reconciliation (recording gross order value as revenue, with commissions as a separate expense) is now compliance critical.

Penalties can be substantially reduced through unprompted voluntary disclosure (you tell HMRC before they write to you). The penalty bands are: careless errors 0% to 30% of tax owed, deliberate but not concealed errors 20% to 70%, and deliberate and concealed errors 30% to 100%. Unprompted voluntary disclosure typically reduces the rate to the bottom of each band, meaning a careless error penalty can fall to as low as 0%. Code of Practice 9 (the Contractual Disclosure Facility) is the route for serious cases and provides immunity from criminal prosecution in exchange for a complete and accurate disclosure within structured timeframes. Professional guidance on disclosure strategy is essential because the timing, scope and presentation of the disclosure significantly affects the outcome.

For most civil enquiries a chartered accountant with investigation experience is sufficient. For Code of Practice 9 disclosures, Electronic Sales Suppression cases, interviews under caution and any criminal investigation, legal representation is essential. Most accountancy firms refer clients to a separate solicitor at this stage, creating delays and duplication of fees. LOYALS provides integrated legal support through our partner solicitors as part of the engagement, so your accounting defence and legal representation are coordinated from the same brief from day one.

Costs depend entirely on the scope and complexity of the investigation. We offer a free initial 30-minute consultation to assess your situation and provide a clear, transparent fee estimate before any work begins. In our experience the penalty reductions and avoided assessments achieved through proper representation typically far exceed the professional fees. We also offer staged payment plans for investigation work because we understand an unexpected HMRC enquiry creates financial pressure that has not been planned for.