How to Respond to COP8 & COP9 HMRC Tax Investigations (2025 Guide)

COP8 and COP9 are the investigations that HMRC starts in cases involving tax avoidance and tax fraud. COP8 and COP9 are the two main Codes of Practice that are used by HM Revenue & Customs (HMRC)  to look into major tax cases involving both individuals and companies. These inquiries are carried out by the Fraud Investigation Service (FIS) of HMRC, a specialised division charged with managing intricate tax compliance matters. Comprehending the differences, procedures, and current patterns in COP8 and COP9 inquiries is essential for taxpayers who are under investigation.

Expert Legal Support You Can Rely on During HMRC Investigations

Our team specialises in handling HMRC tax investigations, including the most complex COP8 and COP9 cases. We combine years of experience as specialist solicitors and barristers, negotiating directly with HMRC, managing contentious tax disputes, and representing clients at Tax Tribunals and the High Court. With our deep understanding of HMRC’s Fraud Investigation Service processes, we provide proactive, strategic advice tailored to minimise penalties and resolve investigations efficiently. Our dedicated legal experts will guide you confidently through disclosure requirements and negotiations with discretion and professionalism. When it comes to navigating HMRC investigations, our expert team is your strongest ally.

COP8: HMRC’s Approach to Complex Tax Avoidance Investigations in 2025

Civil investigations known as COP8 (Code of Practice 8) are started when HMRC suspects a substantial underpayment of taxes, frequently connected to intricate tax evasion schemes or sizable offshore transactions. In some cases, significant tax losses are suspected in high-risk tax arrangements rather than outright fraud. Long-term COP8 investigations typically entail a thorough analysis of financial records and tax planning techniques, occasionally incorporating third-party data from suppliers or banks.

COP8 investigations are generally civil tax investigations, particularly if managed carefully with expert legal advice. However, if HMRC suspects or discovers evidence of fraud at any point during a COP8 investigation, they may shift their approach and handle the investigation under Code of Practice 9.

Unlike COP9, there is no standardised procedure for a COP8 investigation. The primary focus is on gathering information to establish the facts and recover any tax, interest, and penalties due. This process can involve examining your tax returns, accounts, and statements, and obtaining information from third parties, potentially using statutory powers if necessary. HMRC may also request meetings or conduct visits to business premises to inspect records. Full cooperation is encouraged, and you must ensure any information provided is correct and complete.

Understanding COP9: When HMRC Suspects Deliberate Tax Fraud

More serious civil investigations known as Code of Practice 9 (COP9)  are initiated when HMRC detects intentional tax evasion or dishonesty. In contrast to COP8, instances involving COP9 specifically claim fraudulent intent, and taxpayers are formally notified that their actions are being contested. By filing a thorough disclosure report outlining the type and scope of the fraud, taxpayers can use COP9 to voluntarily reveal fraud and avoid criminal prosecution.

Under COP9, HMRC offers the individual the opportunity to make a complete, accurate, open, and honest disclosure of all their deliberate behaviour leading to a loss of tax, duty, or payment administered by HMRC, as well as all other irregularities in their tax affairs (including those arising from non-deliberate behaviour). This is facilitated through a contractual arrangement called the Contractual Disclosure Facility (CDF). The CDF is presented as an alternative to a criminal investigation with a view to prosecution. By entering into the CDF contract, the individual admits that tax has been lost due to their deliberate conduct. In exchange for a full disclosure of the deliberate conduct, HMRC undertakes not to commence a criminal investigation into the suspected frauds related to that disclosed deliberate behaviour.

The individual has 60 days from the date of receiving the COP9 offer to accept or reject the CDF. Accepting the offer creates a binding contractual arrangement. If accepted, the individual must comply with the terms, which involve making an initial Outline Disclosure within the 60-day period and a subsequent Formal Disclosure within an agreed timeframe. The Outline Disclosure requires an honest description of the deliberate conduct, including details like what was done, how it was done, who was involved, how the individual benefited, and the period over which it occurred. The Formal Disclosure involves a complete and accurate disclosure of all irregularities and includes mandatory certified documents such as a statement of worldwide assets and liabilities and certificates of bank accounts and credit cards operated, often alongside a detailed Disclosure Report in complex cases.

Key Differences Between COP8 and COP9

Feature	COP8	COP9
Nature of Allegation	Suspected tax underpayment, avoidance	Suspected deliberate tax fraud
HMRC Approach	Civil investigation without immediate fraud claim	Civil investigation with fraud allegation
Disclosure Requirement	No formal disclosure report required	Full disclosure report mandatory
Penalties	Generally lower, related to tax underpayment	Higher penalties due to fraud and dishonesty
Risk of Criminal Prosecution	Low unless fraud uncovered later	High unless full disclosure made
Typical Targets	Complex tax avoidance, offshore structures	Undisclosed income, falsified records

COP 8 and COP 9: Recent Trends and Statistics

HMRC’s focus on COP8 and COP9 investigations has evolved significantly in recent years, with new cases almost quadrupling from the previous year, COP8 investigations increased significantly in 2022–2023, a sign of HMRC’s heightened scrutiny of tax planning and evasion strategies. Although there were fewer new COP8 cases in 2023–2024, a significant amount of tax was recovered, indicating that ongoing investigations had been successfully concluded. Although there were fewer COP9 cases in 2023–2024, the amount of revenue collected from these investigations rose significantly, in part because of one major settlement that totalled more than £650 million. This emphasises how much money is at stake in fraud cases. Given the magnitude of intentional tax fraud, penalties in COP9 investigations are frequently ten times or more severe than those in COP8. Although there are fewer of these investigators overall than in other cases, HMRC nonetheless invests in specialised investigators for certain situations.

In 2023-24, HMRC opened 212 COP8 investigations and closed 268, recovering £83.2 million. For COP9, 268 cases were opened and 618 closed, with £338.4 million recovered (excluding a £652.6 million settlement). COP8 targets suspected tax underpayment or avoidance, while COP9 focuses on deliberate fraud requiring full disclosure. Despite fewer new cases, tax recovered increased significantly, highlighting HMRC’s focus on high-value investigations and higher penalties in fraud cases.

Are you facing Challenges with a COP9 Investigation?

If you’re facing a COP9 investigation from HMRC, you need expert support to navigate this serious and complex process. Our specialist team of solicitors and barristers has extensive experience handling COP9 cases, guiding clients through every step-from preparing detailed disclosure reports under the Contractual Disclosure Facility to negotiating with HMRC to minimise penalties and avoid criminal prosecution. We understand the high stakes involved and provide clear, strategic advice tailored to your situation, ensuring you respond promptly and confidently. Don’t face a COP9 investigation alone, contact us for an initial conference and let our expert team protect your interests and help you achieve the best possible outcome.

Practical Advice for Taxpayers on COP8 and COP9

Given HMRC’s increasing focus on high-value tax investigations, our team strongly advises individuals and businesses to seek expert advice early. Engaging our tax investigation specialists can help you manage risks, negotiate effectively with HMRC, and potentially reduce penalties. Cooperation with HMRC is crucial-especially in COP9 cases-where full and timely disclosure often mitigates penalties and avoids prosecution. COP8 investigations may involve extensive scrutiny, including third-party enquiries and detailed financial analysis, so thorough documentation and professional support are essential. Ignoring HMRC notices or refusing to engage can lead to prolonged investigations, higher penalties, and increased risk of criminal action. Contact us to ensure you have the expert guidance needed to protect your interests and navigate these complex investigations confidently.

In summary, COP8 and COP9 investigations represent HMRC’s serious approach to tackling tax underpayment and fraud. While COP8 targets complex avoidance without immediate fraud allegations, COP9 addresses suspected deliberate fraud with higher penalties and potential criminal implications. Awareness of these processes and recent trends can help taxpayers navigate investigations more effectively and safeguard their interests.