COP9 Disclosures, Rising HMRC Intervention and the Cost of Waiting

HMRC’s use of the Contractual Disclosure Facility (CDF) under Code of Practice 9 (COP9) remains one of its most direct tools when it suspects serious tax fraud. Entry into the regime requires an admission of deliberate behaviour. Without that, HMRC will not allow access. That point alone shapes the entire process and, in many cases, the outcome.

A taxpayer may be invited by HMRC to make a disclosure, or they may approach HMRC voluntarily. In practice, the distinction is critical. It determines not only the tone of the engagement but also the level of control the taxpayer retains.

Recent data obtained through a freedom of information request provides some insight into how HMRC is using the regime. In the 2025 calendar year, HMRC’s COP9 centre received 127 voluntary applications. Of these, 21 were rejected. That raises an immediate question as to the threshold HMRC applies when deciding whether a taxpayer has said enough to justify entry, particularly where the admission of deliberate conduct must be clear from the outset.

By contrast, HMRC’s own published figures show that 306 COP9 cases were opened in the year to 31 March 2025, an increase from 268 in 2024. The increase is modest but consistent. More notably, the figures suggest that a significant majority of cases, around 65%, arise from HMRC intervention rather than voluntary disclosure. Only 106 taxpayers appear to have entered the process unprompted.

I question whether this reflects a lack of awareness among taxpayers or a reluctance to admit deliberate behaviour without first being challenged. It may also reflect the reality that many individuals do not identify their actions as deliberate until HMRC sets out its view.

The benefits of a voluntary disclosure are often stated but not always fully appreciated. A taxpayer who approaches HMRC before any formal contact retains a degree of control that is otherwise lost. Once HMRC issues a COP9 invitation, the individual is faced with a formal allegation of fraud and a strict 60 day deadline to respond. That timeframe can be unforgiving, particularly where records are incomplete or advisers are not yet in place.

There is also the question of penalties. HMRC is obliged to consider penalties where inaccuracies arise. Within CDF, the minimum penalty for deliberate behaviour starts at 20%. That position becomes more difficult once HMRC initiates contact. In those cases, the starting point is typically higher, often around 35%. The difference is not insignificant, particularly where liabilities span multiple years.

Control of the narrative is equally important. A voluntary disclosure allows the taxpayer to frame the issues, quantify the exposure, and present the facts in a structured way. By contrast, an HMRC-led process often begins with assumptions which the taxpayer must then displace.

HMRC’s broader approach to tackling evasion also appears to be evolving. A 2025 report by the House of Commons Public Accounts Committee concluded that the true cost of tax evasion is likely higher than HMRC’s estimates. It recommended a more defined and robust strategy.

One response has been the introduction of the Strengthened Reward Scheme in late 2025. This allows individuals to receive between 15% and 30% of recovered tax for providing information on serious non-compliance. The intention is clear. HMRC is seeking to increase the flow of intelligence from third parties.

If that strategy proves effective, it is reasonable to expect an increase in COP9 interventions. More information leads to more enquiries. More enquiries lead to more invitations into the regime. The trend in case numbers already suggests gradual expansion.

The practical consequence is that fewer taxpayers will have the opportunity to approach HMRC on their own terms. Those who delay may find themselves responding to a formal allegation rather than managing a disclosure.

HMRC will likely view the increase in COP9 cases as evidence of progress. In principle, it is. Yet the key question remains whether the balance between voluntary compliance and enforced disclosure is where it should be. If most cases arise from HMRC action, the system risks becoming reactive rather than preventative.

For the taxpayer, the position is more straightforward. The difference between a voluntary disclosure and an HMRC-led process is not just procedural. It affects penalties, timing, and ultimately the outcome. The data suggests that many are still waiting until HMRC makes the first move.

If you want to discuss your tax position drop us an message through our contact page here

COP9 what is it?

Under COP9 the individual under investigation and HMRC will enter a contract whereby the individual
commits to make a complete, accurate, open and honest disclosure of all deliberate behaviour and all other
irregularities in their tax affairs. In return HMRC commits not to open a criminal investigation. This is called the
Contractual Disclosure Facility (CDF)

For more detailed information regarding COP9 investigations click here

Visit HMRCs website to learn more on COP9