In 2021, HMRC introduced a new range of checks on Self-Assessment repayment claims. These new checks, known as a SURF1 or SURF2 letter, are largely shrouded in secrecy. HMRC have not issued any documentation or statements on the checks, despite numerous requests from a variety of groups, including Maximoor. This short blog has been written to share what we understand about these checks with our clients.

What Is The Purpose Of These Letters?

Because HMRC have not officially written about these checks, we do not know for certain the purpose of the checks. According to the letter, the check is to verify identity and the repayment claim. Although the information requested is extensive.

What Is The Difference Between A SURF1 And A SURF2 Letter?

A SURF1 letter is a letter which HMRC sends to verify that the details they hold regarding a taxpayer is correct, prior to issuing a SURF2 letter. Once the information is verified, the SURF2 letter follows.

A SURF2 letter is a letter sent by HMRC to the taxpayer requesting a wide range of documentation and information. HMRC withhold the tax repayment from being sent until these checks are complete.

In our experience, the SURF1 letter is often skipped.

Is This An Enquiry?

No. HMRC have to follow very specific rules to launch enquiries into Self-Assessments (Tax Returns). The SURF2 letters which HMRC send typically include a sentence specifically stating that the check is not an enquiry.

Are All Letters The Same?

No. The letters are similar, but we have noticed some variation in the level of information requested.

What Do You Need To Do?

If you are a client of ours, you just need to follow our instructions. Our "Enquiry Protection", means that we will deal with HMRC on your behalf every step of the way. We have successfully dealt with the overwhelming majority of these checks on behalf of our clients and know what to do to satisfy HMRC’s requests.

If you have received one of the letters from HMRC, get in touch with us immediately and a member of our team will get started with our response straight away.

How Can HMRC Be Contacted About This?

The only way that HMRC can be contacted about these letters is via post. The HMRC team that deals with these letters keeps their information separate from the team at HMRC which answer the phone. So calling HMRC to ask questions or for details regarding these checks usaully yields no results. The address HMRC asks you to respond to (BX9 1QE) is not even listed on their website as one of their many official addresses.

What Happens If You Do Not Respond?

HMRC gives an arbitrary time limit of 30 days for the taxpayer to respond with all of the requested information. We have responded to letters outside of this deadline and successfully lifted the block on the tax repayment. However, it is of course advisable to respond within the 30 days.

HMRC also threaten that should the letter not be responded to, they will remove the taxpayer from the Self-Assessment system and that this may affect any Self-Employed Income Support Scheme payments. Whilst we have not seen this happen in practice, this is not a threat to be taken likely.

How Long Will This Hold Your Repayment?

HMRC will hold onto your tax repayment until these checks are complete. There is no maximum time. In our experience, it takes around a month to collate all of the information, send it to HMRC and receive a positive response, although it can take longer.

Fighting For You

We will continue to challenge, on behalf of our clients and taxpayers generally,  this questionable use of Revenue powers.  The processes of HMRC should be clear and transparent.  The SURF letters are a departure from this rule.