Ignoring an HMRC compliance check letter doesn't stop the check; it usually makes things worse. HMRC can issue formal information notices, raise penalties for non-compliance, and estimate your tax liability using the information it already holds. Responding, even briefly, keeps you in control of the process and preserves your appeal rights.
Reply to the original letter even if your answer is incomplete.
If the reply date on your letter is within 14 days, call 020 3441 1258 rather than waiting, or check the reply to an enquiry you have already sent.
Silence does not close an HMRC compliance check. It typically pushes HMRC to escalate, using formal powers instead of informal requests.
Once a case moves to formal notices, penalties for non-compliance can apply, and HMRC may form its own view of your tax position without your input.
Even a short, honest reply explaining your situation is almost always better than no response at all.
Where HMRC has issued a formal information notice under [Schedule 36 to the Finance Act 2008](https://www.legislation.gov.uk/ukpga/2008/9/schedule/36), failing to comply can trigger fixed penalties, followed by daily penalties for continued failure, and higher penalties for persistent non-compliance.
Separately, under the [Taxes Management Act 1970](https://www.legislation.gov.uk/ukpga/1970/9), HMRC can raise a discovery assessment if it believes tax has been underpaid, based on whatever evidence it has gathered, which may not reflect your actual position accurately.
These powers exist precisely because compliance checks depend on taxpayer cooperation. The legislation is designed to give HMRC a route forward when that cooperation doesn't happen.
As director, an unanswered letter about the company can lead to HMRC estimating corporation tax liabilities using bank data, third-party information or industry benchmarks, which may overstate what's actually owed.
A discovery assessment based on incomplete information can be higher than reality, and challenging it after the fact is harder than engaging with the original check.
If cash flow or workload is the real reason you haven't replied, say so. HMRC is generally more receptive to a director who explains delay than one who says nothing.
The direct cost is penalty exposure plus the risk of an inflated assessment based on assumptions rather than your actual records.
The indirect cost is a longer, more adversarial enquiry, since HMRC has less reason to trust future correspondence once a deadline has been missed without explanation.
Getting professional help before things escalate is usually cheaper than after. Growth plans include free tax investigation insurance covering professional costs during a genuine enquiry, explained at [/fees](/fees).
Don't assume HMRC will simply move on if you don't reply. Compliance checks are tracked, and non-response is itself flagged internally.
Don't wait for a second or third letter before engaging. Each escalation stage narrows your options and adds cost.
Don't respond in a rush just to avoid penalties, without checking the figures are accurate. A hurried, wrong answer can create new problems.
*Included on the Growth plan — see our fees.
What happens if I ignore an HMRC compliance check letter? is handled by the same team at Accotax London Limited, 12 London Road, Morden, London SM4 5BQ. We deal with HMRC compliance checks for limited company directors across Morden, Wimbledon, Mitcham, Sutton, Croydon, Kingston and central London, and by video call for companies anywhere in the UK.
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