Limited company guide
Quick answer
An HMRC compliance check letter means HMRC wants to check that your company's tax return or records are correct. It is not an accusation of fraud. Read which tax and period it covers, note the deadline, gather the records asked for, and reply on time, ideally with an accountant who can deal with HMRC for you. A calm, accurate response helps HMRC assess the position; any penalty depends on the facts and applicable rules. — LimitedCompany.Accountants, ICAEW-regulated accountants for UK limited companies.
What an HMRC compliance check letter means for a UK limited company, how far back HMRC can go (4, 6 or 20 years), how to respond, how long checks take and possible outcomes.
Last updated 8 November 2026. Official references are listed below.
An HMRC compliance check letter means HMRC wants to check that your company's tax return or records are correct. It is not an accusation of fraud. Read which tax and period it covers, note the deadline, gather the records asked for, and reply on time, ideally with an accountant who can deal with HMRC for you. A calm, accurate response helps HMRC assess the position; any penalty depends on the facts and applicable rules.
Why does HMRC open a compliance check?
What will the letter tell me?
How far back can HMRC go?
How should I respond?
How long does a compliance check take?
What are the possible outcomes?
Can you help me respond to an HMRC letter?
HMRC checks Corporation Tax, VAT, PAYE and directors' personal tax. Common reasons for a limited company include:
A letter can arrive even if you have done nothing wrong.
• Figures that look unusual compared with similar businesses
• Large or unexpected expense claims
• Big swings in profit, VAT or director's pay
• Overdrawn director's loan accounts or dividends without paperwork
• Random selection
Read it carefully. It should state the following. If HMRC sends a formal information notice, you must comply within the time given or penalties can follow.
• Which tax (for example Corporation Tax or VAT) and which period
• Whether it is a check of one item or the full return
• What records or information HMRC wants
• The deadline to reply
• Which CC/FS factsheet applies; these explain your rights and how penalties work
For a Company Tax Return filed on time, HMRC can usually open an enquiry up to 12 months after the return is delivered. Outside that window it can still raise an assessment if it finds tax was lost.
The following are Corporation Tax assessment time limits, measured from the end of the accounting period. They are not universal limits for VAT, PAYE or personal tax, which have their own rules. See HMRC Compliance Handbook CH56200 in the official sources below.
That is why companies must keep records for at least 6 years from the end of the financial year, and longer while a check is open.
• Normally 4 years
• 6 years where the loss of tax was brought about by careless behaviour
• 20 years where the loss of tax was brought about by deliberate behaviour or certain failures to notify, subject to the applicable statutory conditions — not only deliberate errors
1. Do not ignore it. Missing the deadline makes things worse.
2. Tell your accountant straight away and authorise them to deal with HMRC.
3. Gather the records requested: bank statements, invoices, receipts, payroll and dividend paperwork, and the director's loan account.
4. Answer only what is asked, accurately and on time.
5. Disclose any mistakes you find before HMRC does. Penalties are lower when you tell HMRC and help put things right.
There is no fixed length. A simple check of one item can close within weeks; a full check can take months. Clear, complete answers usually shorten it.
HMRC will either close the check with no change, or ask for extra tax plus interest, and possibly a penalty based on whether the error was careless, deliberate or neither. If you disagree, you can ask for a review or appeal to the tax tribunal.
LimitedCompany.Accountants helps UK limited company directors respond to HMRC compliance checks, prepare records and keep future returns clean with our Business-as-a-Service accounting. Get a quote or book a call at https://limitedcompany.accountants, call 020 3441 1258 or email hello@limitedcompany.accountants (12 London Road, Morden, London SM4 5BQ).
Primary references
Local help
We work with company directors across London and Surrey from our office at 12 London Road, Morden, London SM4 5BQ. Pick your area, or send the form below and we will call you back.
Frequently asked
No. Many checks are routine or random. Treat it seriously, but it is not an accusation.
Yes, once they are authorised as your agent. Most directors prefer this.
Tell HMRC honestly and give the best information you can. Reconstructing records with an accountant is better than guessing.
Some accountants offer fee protection that covers professional fees for HMRC enquiries. Ask before you need it.
Keep bank statements, sales and platform reports, purchase invoices, payroll records, VAT workings, finance agreements and Companies House correspondence. We confirm the exact list at onboarding and identify gaps before a filing deadline becomes urgent.
The fee depends on transaction volume, record quality, VAT and payroll requirements, historic catch-up and the level of reporting needed. We agree a fixed scope and price before technical work starts, with published packages available on our fees page.
Yes. We request professional clearance, collect the prior records and authorities, check the next Companies House and HMRC deadlines, and give you one clear handover list. The process is normally completed remotely.
Yes. We work through secure cloud records, scheduled reviews and digital approvals, while keeping a named team available by phone, video call and email. Clients can also visit our Morden office by appointment.
We regularly work with Xero, QuickBooks, FreeAgent, Sage and connected sales or expense apps. The right setup depends on transaction volume, integrations and the reports you need, not simply the software brand.
The relevant calendar may include annual accounts, Corporation Tax payment and return dates, confirmation statements, VAT returns, payroll submissions and Self Assessment. We map the dates from your company year end and registrations.
Included approach
Check the current rules
Deadlines, thresholds and filing rules change. GOV.UK and Companies House publish the current statutory position; advice should then be applied to your company’s circumstances.
Two ways to work with us
Everything is fixed price and agreed before we start. Prices are the same whether you are in London, Morden, Croydon or anywhere else in the UK.
All-inclusive packages
One fee covering your company’s filing calendar, with the price based on your turnover band.
One-off online filing
No monthly commitment. Add what you need to one basket and pay by card, with government fees shown separately at cost.
Not sure which fits? Book a free consultation or get an instant quote.
Talk to an accountant
Share your next deadline, accounting problem or growth question. We will reply with a clear next step and quote any technical work before it begins.
Chat with ACCOTAX on WhatsAppPick a time that suits you and a qualified accountant will call you about your company, deadlines and fees.
Appointments run Monday to Friday, 9:00am to 5:30pm. Your confirmation is emailed straight away.
Four London offices
Work with us entirely online, or sit down with your accountant at whichever office suits you. Open Monday to Friday, 9:00am to 5:30pm. Office visits are by appointment only, so please book before coming in.
Free, no obligation
Pick a time that suits you and a qualified accountant will call you about your company, deadlines and fees.
Appointments run monday to friday, 9:00am to 5:30pm. Your confirmation is emailed straight away.
