tel. 02088 022 772 or 0208 800 8633 (available evenings & weekends)
To Add menu Go Here

The red flags that HMRC looks for

Home / Blog Entry / The red flags that HMRC looks for

Brian G Lonis & Co has been in business for more than three decades. During this time, we have had the pleasure to learn all about the profession. Thanks to our hard work, we have even become the leading company for tax enquiries and investigations London has. Clients frequently use our knowledge of the complex system used by HMRC to improve their own situations.

Tax enquiries and investigations LondonHMRC tax investigations are not something that regular company owners want to experience. Sadly there is nothing you can do to ensure that they won’t investigate you. Even businesses with absolutely no hint of wrongdoing could have a surprise audit.

However, this does not mean it is impossible to lower the possibility. It is a well-known fact that HMRC is elusive about the criteria they use to decide when to do investigations. Thanks to the sheer amount of time they have been operating though, we have been able to discover several red flags they look for.

Shifting numbers

One red flag is when numbers shift by a considerable margin. Year-on-year, companies seldom pull in the exact same figures. Yet, another rarity is margins fluctuating massively. If that happens it can make alarm bells ring.

To give an example, we will say that you made £900,000 in 2018. In 2019 though, the figure fell suddenly to £300,000. Chances are there will be an entirely reasonable explanation for this. HMRC shall notice the drop however.

What you should do is tell HMRC the precise reason why your profits were hit so much. It could just be a case that you invested in a new building or more capital.


It is not impossible to be in business for years without turning a profit. However, you might be providing HMRC with a return claiming you owe no tax every year. After a while, investigators will ask how and why you are still operating. The solution here is the same for fluctuating numbers; tell them why you are not being profitable.

Help with tax enquiries and investigations in London

At Brian G Lonis & Co, we supply clients with the expert support and help they require. We work very hard to ensure they have the best experience every time. In addition, we are clear with our charges.

We are the most experienced company working in tax enquiries and investigations London has. As a result, you can rely on us for simple or complex matters. If you need to speak to our team, contact us.