HMRC Enquiries and Closure Notices: What To Expect and What To Do

You've received a letter from HMRC. It says they're going to "check" your tax return. The language is formal, there's a reference number, and you're not sure whether you should be worried.

Here's the first thing to know: an HMRC enquiry doesn't mean they think you've done anything wrong. HMRC selects returns for enquiry both randomly and based on risk indicators—common triggers include large or unusual claims, inconsistencies between different returns, or industry-specific risk profiles. Many enquiries end with no changes at all. But it's a formal legal process, and it comes with rules that protect you as well as HMRC.

What the Enquiry Letter Looks Like

The notice of enquiry is a formal HMRC letter, usually headed "Opening of Enquiry" or "Notice of Enquiry into your tax return." It will reference section 9A TMA 1970 (or the equivalent provision), state which tax return is being enquired into (by tax year), and include HMRC's reference number. It's not the same as a routine HMRC letter—if you're unsure whether what you've received is a formal enquiry notice, look for the s.9A reference.

This guide covers what an enquiry means, what happens during one, how it ends, and what to do when you receive the closure notice that triggers your appeal rights. If you're looking for the big-picture view of a UK tax dispute, our complete timeline maps every stage from start to finish.

What Is an HMRC Enquiry?

An HMRC enquiry—sometimes called a "compliance check"—is a formal investigation into a tax return you've filed. HMRC is checking whether the return is correct and whether you've paid the right amount of tax.

It's not a criminal investigation. It's not an accusation. It's HMRC exercising its legal power to verify the information in your return.

Self-Assessment Enquiries

For income tax self-assessment returns, HMRC's power to open an enquiry comes from section 9A of the Taxes Management Act 1970. Under s.9A(1), an officer may enquire into your return by giving you a "notice of enquiry" within the time allowed.

The enquiry can extend to anything contained in your return—or anything that should have been in it. That includes your income figures, expenses, claims, and elections (s.9A(4)).

One important limitation: your return can't be subject to more than one enquiry at a time (s.9A(3)), unless you've amended it after the original enquiry was opened.

Partnership Enquiries

If you're in a partnership, HMRC can enquire into the partnership return under section 12AC TMA 1970. The rules mirror the self-assessment enquiry provisions, but there's an important knock-on effect: when HMRC opens a partnership enquiry, it automatically triggers enquiries into each partner's individual return (s.12AC(6)). If you're a partner, this means an enquiry into the partnership return is also an enquiry into yours.

VAT Compliance Checks—A Different Process

VAT doesn't follow the same enquiry and closure notice structure. There's no formal "notice of enquiry" for VAT returns. Instead, HMRC conducts compliance checks using their general information powers and, if they believe VAT is incorrect, makes an assessment under section 73 of the VAT Act 1994.

The appeal right for VAT assessments comes from section 83(1)(p) VATA 1994, and the time limits are different—generally two years from the end of the accounting period, or one year from when evidence comes to HMRC's knowledge (s.73(6)).

The general principles in this guide about cooperation and information notices still apply to VAT. But the formal enquiry/closure notice framework described below is specific to self-assessment (income tax, capital gains tax, and corporation tax).

Can HMRC Open an Enquiry Into Your Return?

HMRC can't open an enquiry whenever they like. The law sets a strict window, and if HMRC misses it, they can't use the enquiry power at all.

The 12-Month Window

If you filed your return on time, HMRC must issue the notice of enquiry within 12 months of the date you filed (s.9A(2)(a) TMA 1970). For most people filing online self-assessment, the filing deadline is 31 January following the tax year. If you filed on, say, 15 December 2024, HMRC has until 15 December 2025 to open the enquiry.

What If You Filed Late?

If you filed after the deadline, the window extends slightly. HMRC has until the next "quarter day" after the first anniversary of when you actually filed. The quarter days are 31 January, 30 April, 31 July, and 31 October (s.9A(2)(b)).

For example, if you filed late on 10 March 2025, the first anniversary is 10 March 2026, and the next quarter day after that is 30 April 2026. So HMRC would have until 30 April 2026 to open the enquiry.

What If HMRC Missed the Window (Discovery Assessments)?

If HMRC misses the 12-month window, they can't open a formal enquiry. But they're not necessarily out of options. If HMRC later discovers that your return was incorrect, they may be able to raise a "discovery assessment" under section 29 TMA 1970—but that requires meeting tighter conditions. We cover discovery assessments in their own section below.

If you've received a notice of enquiry, it's worth checking whether it was issued within the statutory window. If it wasn't, the enquiry may not be valid. The date on the notice, combined with the date you filed your return, will tell you.

What Happens During an Enquiry

Once an enquiry is open, HMRC will ask you for information. This usually starts informally and can escalate to formal legal requirements.

Informal Requests

HMRC will typically begin by writing to you—or your accountant, if you have one—asking questions about specific entries in your return. They might ask for invoices, bank statements, receipts, or explanations of particular figures.

These initial requests are informal—you're not legally compelled to respond. But practically speaking, cooperation is important. HMRC's own factsheet (CC/FS1a) emphasises voluntary cooperation as the starting point.

Formal Information Notices (Schedule 36 FA 2008)

If informal requests don't get the information HMRC needs, they can escalate to formal information notices under Schedule 36 of the Finance Act 2008. A formal notice is a legal requirement to provide specific information or produce specific documents. There are several types:

• Taxpayer notices (paragraph 1)—requiring you to provide information or documents about your own tax affairs
• Third party notices (paragraph 2)—requiring someone else (like your bank) to provide information about you
• Financial institution notices (paragraph 4A)—requiring banks and financial institutions to provide information

The test for a valid information notice is that the information must be "reasonably required" to check your tax position.

Penalties for Not Complying

Ignoring a formal information notice carries serious consequences. The penalty regime escalates:

A tax-related penalty requires authorisation from the Upper Tribunal and is reserved for serious cases. But the initial £300 and daily penalties can add up quickly if you simply don't respond.

Deliberately concealing or destroying documents that HMRC has requested can trigger a criminal investigation—a much more serious matter than the enquiry itself.

Your Rights During an Enquiry

You aren't powerless during an enquiry. The law gives you several protections:

• You have the right to know what HMRC is checking. The notice of enquiry should tell you.
• You can be represented. You can appoint an accountant, tax adviser, solicitor, or even a friend or relative to deal with HMRC on your behalf.
• Documents covered by legal professional privilege are protected. HMRC can't demand communications between you and your lawyer made for the purpose of obtaining legal advice.
• You can appeal a formal information notice. If you believe the notice isn't reasonably required, you have 30 days to appeal it to the tribunal. Note: this right isn't available where the tribunal has already approved the notice, or where the notice requires only "statutory records" (essentially, business records you're required to keep by law).
• You're only required to provide what HMRC has specifically asked for. There's no obligation to volunteer additional information beyond the specific requests.
• You can request extra support if you have health conditions or personal circumstances that make it difficult to engage with the process.

For more on penalties generally, see our guide to HMRC penalties explained.

How Long Can an Enquiry Last?

There's no statutory time limit on how long an enquiry can remain open. Some enquiries are resolved within a few months. Others drag on for years, particularly where complex tax arrangements are involved or HMRC is waiting for information.

But the law doesn't leave you without a remedy if HMRC is taking too long.

Applying for a Closure Direction (s.28A(4))

Under section 28A(4) TMA 1970, you can apply to the First-tier Tribunal for a direction requiring HMRC to issue a closure notice within a specified period. This is sometimes called a "closure direction" or "closure application."

The test is set out in s.28A(6): the tribunal must grant the direction unless HMRC satisfies it that there are "reasonable grounds for not issuing" the closure notice within the specified period. The burden is on HMRC to justify continuing the enquiry—not on you to prove it should end.

This is a powerful tool. If your enquiry has been open for a prolonged period and HMRC doesn't appear to be making progress, a closure direction is worth considering.

When Closure Applications Succeed—and When They Don't

The tribunal takes these applications seriously. In HMRC v Hitchins [2024] UKUT 114 (TCC), HMRC appealed after the First-tier Tribunal directed closure of enquiries into the Hitchins' returns. The Upper Tribunal dismissed HMRC's appeal, confirming that HMRC must demonstrate it's actively progressing the enquiry and has specific, reasonable grounds for continuing. The tribunal isn't a rubber stamp for HMRC.

But closure applications don't always succeed. In Gearslutz.com Ltd & Standen v HMRC [2021] UKFTT 150 (TC), the tribunal dismissed the application because HMRC showed it reasonably required further information to determine the correct tax treatment. The test under s.28A(6) is genuine—it works both ways.

The practical lesson: a closure application is strongest when HMRC has had ample time to request information, you've cooperated fully, and the enquiry appears to have stalled.

How an Enquiry Ends: Closure Notices

An enquiry ends when HMRC issues a closure notice. This is the formal document that wraps up the investigation and tells you what HMRC has concluded.

What a Closure Notice Must Contain

Under section 28A(2) TMA 1970, a closure notice must:

1. State the officer's conclusions—what HMRC has decided about your tax position
2. Either confirm that no amendment is needed (meaning your return was correct) or make the amendments required to give effect to those conclusions

A closure notice takes effect when it's issued (s.28A(3)). If it includes amendments to your return, those amendments are effective immediately—though you have the right to appeal them.

Your Total Financial Exposure

If the closure notice amends your return, your total liability may include three components:

• Additional tax—the difference between what you originally paid and what HMRC says you owe
• Interest—running from the original due date of the tax, not from the date of the closure notice. For an enquiry spanning several years, the interest can be a significant sum
• Penalties—if HMRC believes the inaccuracy was careless or deliberate, they may issue an inaccuracy penalty under Schedule 24 FA 2007, typically alongside or shortly after the closure notice. See our guide to HMRC penalties for how these are calculated

Ask HMRC to confirm the full amount—including interest—before deciding whether to accept, review, or appeal.

Partial Closure Notices

Since November 2017, HMRC has been able to issue partial closure notices—closing individual matters within an enquiry while the broader investigation continues. This was introduced by section 63 and Schedule 15 of the Finance (No.2) Act 2017.

A partial closure notice resolves a specific "matter"—anything contained in the return that can be settled separately. For example, if HMRC is enquiring into both your employment income and a capital gains claim, it could issue a partial closure notice on the employment income while continuing to investigate the capital gains.

This matters because a partial closure notice triggers appeal rights for that specific matter. You don't have to wait until the entire enquiry is finished to challenge a conclusion you disagree with.

When HMRC issues a final closure notice after partial ones, it confirms that all remaining matters are complete (s.28A(1B)).

One important limitation, established by the Upper Tribunal in HMRC v Embiricos [2020] UKUT 370 (TCC): a partial closure notice must fully resolve the matter it addresses, including the tax consequences. HMRC can't issue a partial closure notice that merely states a factual conclusion (such as "you are UK-domiciled") without quantifying the resulting tax amendment.

The 30-Day Clock Starts

The closure notice is the trigger for your appeal rights. Once you receive it, you have 30 days to decide what to do. If you miss that deadline, you'll need to apply for a late appeal—and the tribunal doesn't grant those automatically.

What To Do When You Receive a Closure Notice

This is the moment everything changes. During the enquiry, you didn't have formal appeal rights against HMRC's investigation (except against information notices). Now you do.

Check the Conclusions and Amendments

Read the closure notice carefully. Ask yourself:

• What has HMRC concluded? Do the conclusions match the evidence? Are there factual errors?
• What amendments have been made? Check the numbers. Verify that the tax calculation is correct, even if you accept HMRC's conclusions on the underlying facts.
• Has HMRC addressed everything? If this is a partial closure notice, understand which matters are closed and which remain under enquiry.

Your Three Options

You have 30 days from the date of the closure notice to choose one of three paths:

1. Accept the conclusions. If you agree with HMRC's amendments (or the closure notice confirms no changes), you don't need to do anything. The matter is settled.

2. Request an HMRC review. A statutory review is a fresh look at the decision by a different HMRC officer. It's free, takes 45 days, and doesn't prevent you from going to the tribunal afterwards. In more than half of cases, the review changes the outcome.

3. Appeal to the tribunal. You can appeal directly to the First-tier Tribunal (Tax Chamber). There's no fee (£0), and the tribunal takes a completely independent look at your case. A tribunal appeal typically takes 6-12 months to resolve.

You can request a review first and then appeal to the tribunal if the review doesn't go your way. But you must respond within the 30 days deadline—if HMRC offers a review and you don't respond in time, your appeal may be treated as settled in HMRC's favour. For full details on how this works, see our guide on understanding your appeal rights.

Discovery Assessments: When HMRC Acts Outside the Enquiry Window

If HMRC didn't open an enquiry within the 12-month window, they haven't necessarily lost the ability to pursue you. Under section 29 TMA 1970, an officer can make a "discovery assessment" if they discover that your tax assessment is insufficient—that is, you've paid less tax than you should have.

The Two Conditions (s.29)

Where you've filed a self-assessment return, HMRC can only raise a discovery assessment if at least one of two conditions is met (s.29(3)–(5)):

Condition 1: Carelessness or deliberate behaviour. The insufficiency was brought about carelessly or deliberately by you or someone acting on your behalf (s.29(4)).

Condition 2: The officer couldn't reasonably have known. At the time the enquiry window closed, the officer "could not have been reasonably expected, on the basis of the information made available to him before that time," to be aware of the insufficiency (s.29(5)).

The second condition is sometimes called the "staleness defence" because it asks whether HMRC already had enough information to spot the problem from your return.

Time Limits: 4, 6, and 20 Years

Discovery assessments are subject to their own time limits, set out in sections 34 and 36 TMA 1970:

The behaviour classification matters enormously. If HMRC alleges carelessness or deliberate behaviour, they need to demonstrate it—and you can challenge that classification on appeal.

The "Staleness Defence" (Langham v Veltema)

The leading case on the s.29(5) condition is Langham v Veltema [2004] EWCA Civ 193. The Court of Appeal made two important points:

First, the test is about what the officer could reasonably have been aware of, not what the officer should have done. There's no obligation on HMRC officers to conduct investigative scrutiny of every return. As Auld LJ put it: "it is plain from the wording of the statutory test in section 29(5) that it is concerned, not with what an Inspector could reasonably have been expected to do, but with what he could have been reasonably expected to be aware of."

Second, the definition of "information made available" in s.29(6) is exhaustive. Only information that came from you counts—your return, accompanying documents, or information produced during any enquiry. Information HMRC held from other sources (like employer returns) doesn't count unless it falls within those categories.

The staleness defence has real teeth when your return clearly disclosed the relevant information—but it has limits. If the insufficiency wasn't apparent from what you provided, HMRC may still raise a discovery assessment years later.

Note: the Supreme Court in HMRC v Tooth [2021] UKSC 17 rejected a different concept also called "staleness"—the idea that a discovery expires if HMRC delays acting on it. That ruling does not affect the s.29(5) information-availability defence described above, which remains good law.

Practical Tips for Unrepresented Taxpayers

If you're dealing with an HMRC enquiry without professional help, here are some practical points:

• Keep everything. Every letter, email, and document you send or receive. Create a folder and log dates. If the dispute reaches the tribunal, you'll need to show what happened and when.

• Respond on time. Missing deadlines makes things worse. If you need more time, ask for it in writing before the deadline passes. HMRC will often agree to reasonable extensions.

• Cooperate, but know the boundaries. Cooperation is generally in your interest, and the tribunal will consider it if the case goes further. But cooperation means responding to what HMRC has asked for—you're not required to volunteer information beyond the specific requests.

• Check the basics. Was the enquiry opened within the 12-month window? Does the notice of enquiry name the correct return? These procedural points matter, and they're easy to verify.

• Don't panic about information notices. If you receive a formal notice under Schedule 36, read it carefully. You have 30 days to appeal it to the tribunal if you believe it isn't reasonably required—but consider whether the information genuinely is reasonable before taking that step.

• Consider a closure application if things stall. If your enquiry has been open for a long time and HMRC doesn't seem to be progressing it, the s.28A(4) closure direction is a real option. The burden is on HMRC to justify continuing, not on you to prove it should end.

• Think about getting help. If your enquiry looks like it may result in significant tax adjustments or penalties, it's worth getting advice. Free sources include TaxAid (for people on low incomes) and Citizens Advice. Even a single consultation with a tax adviser can help you understand your position.

Official Resources

• About compliance checks (CC/FS1a) — HMRC's factsheet on what to expect during a compliance check
• Information notices (CC/FS2) — HMRC's factsheet on formal information notices and your rights
• HMRC compliance checks factsheet collection — full set of ~40 compliance check factsheets
• Section 9A TMA 1970 — power to open an enquiry into a self-assessment return
• Section 28A TMA 1970 — closure notices and closure directions
• Section 29 TMA 1970 — discovery assessments
• Schedule 36 Finance Act 2008 — HMRC's information and inspection powers
• Tax checks and enquiries (LITRG) — plain-English guidance for unrepresented taxpayers
• Understanding your HMRC appeal rights — what happens when you receive an appealable decision
• HMRC internal review — how the statutory review process works
• How to appeal to the tax tribunal — step-by-step guide to filing an appeal
• The complete timeline of a UK tax dispute — every stage from decision to resolution
• Settling your tax tribunal case — negotiation during or after an enquiry, ADR, and section 54 agreements
• Late appeal to the tax tribunal — what to do if you miss the 30-day deadline

This article is for informational purposes only and does not constitute legal or tax advice. For advice specific to your situation, consult a qualified tax adviser, accountant, or solicitor.