Why You Need Tax Protection

They arrived, first by letter and then in person, to investigate the tax return. They wanted papers going years back and had a host of questions, many of them requiring technical knowledge to answer. Meantime, the victim of their attention had a life to lead and a family to feed - in other words not a whole lot of time.
 
Whatever the reason for a tax investigation by HMRC - and they probably won't tell you the reason, even after it's over - you're going to need professional help if they come calling on you. Lots of it. And professional help costs money. Lots of money.
 
That's why it makes sense to take out insurance against such a contingency. In the case above, the cost was £42 pa, with the policy holder paying the first £500 in fees. That turned out to be a mere fraction of the professional fees incurred in this particular investigation.
 
There are quite a few policies around covering tax protection - you may want to consult your accountant or insurance broker. The one in the example referred to here was Abbey Tax on www.abbeytax.co.uk, who performed to the letter of their promise, working directly with the accountants whose fees were being incurred.
 
To round off the story at the start of this tip, after an in depth investigation it turned out the taxman owed him a few hundred pounds, but that didn't stop the client incurring a few thousand pounds in professional costs - all of which, bar the first £500, were paid by Abbey.