Tax enquiry insurance

Geosurvey

My accountant is nagging me to buy tax enquiry insurance, as it is apparently very costly if you are the subject of an HMRC investigation. Is this true and how much does it usually cost? Also who are you paying - the HMRC or the accountant?

Any

Geosurvey wrote: »

My accountant is nagging me to buy tax enquiry insurance, as it is apparently very costly if you are the subject of an HMRC investigation. Is this true and how much does it usually cost? Also who are you paying - the HMRC or the accountant?

I've never heard of such a thing..(not saying there isn't one though)
You would be surely paying the accountant though. You would only be paying HMRC for any penalties would they find anything dodgy/wrong.

reddevilled

I think quite a few accountants do this now. The policies are underwritten by a third party and are to cover the accountants fees if you have an enquiry into your tax affairs.

How much an investigation costs depends on the complexity of your affairs, the degree of investigation and a number of other factors.

Like any insurance, find out your own accountants charges for dealing with a standard enquiry and think whether its worth it based on what they plan to charge for the insurance.

Geosurvey

Thank you for your replies - very helpful.