Give a full and accurate accounting of the event to HMRC. If they want tax then yes, you are trading.
No. It means they want to dip into your money.
Given that they frequently get taken to court and lose, the fact that HMRC want money out of you does not mean all that much. They are notorious for "interpreting" the law and rules in their favour regardless of the merits of the case.
Given your line of work, I assume you'll have at least heard of IR35 and probably know people affected by it. From memory, I believe there have been many cases involving IR35 that have gone to court and HMRC have lost.
And the latest wheeze I've read up on involves people who have used a tax avoidance scheme - and correctly declared both that they have used it and what it is. HMRC have written some small print in a letter to the tax payer which means they've opened an investigation - thus giving themselves an unlimited time to leave it on the shelf before doing anything (and of course, allowing the "disputed" tax to build up), and unless the taxpayer understands the technical meaning of an innocuous sentence then they never knew about it. Then a decade later, HMRC, after having been given the power by the ****wits in Westminster, turn round to the taxpayer and basically say "You owe us this disputed tax, you have to pay it NOW and then we'll discuss the merits of the case" (it's called an Accelerated Payment Notice). How would you stand if you had 90 days to find (say) 100k ? Don't worry, if your case is sound then you'll get it back when you win ... in a few years time. I bet lots of people thought "oh what a great idea" when they heard that HMRC could demand tax off suspected cheats - not realising how the power would be used. People have been forced to sell the family home, it's caused divorces, and even IIRC at least one suicide.
Now, looking at the schemes being talked about, some of them are clearly taking the wee-wee and those using them really couldn't have not known they were bogus. But I cannot believe that not one single scheme caught up in this is not valid. But the injustice is that HMRC knew about them for a decade and did absolutely nothing at all - now they've got the power to simply take the money they think they should be owed and drag it out for a few more years before losing in court and paying it back with a pittance of interest.
So no, don't ever try and tell me that "if HMRC ask for money ..." They've been proven time and time again to be a bunch of thieving scumbags.
And before you ask - no I am not affected*, and I don't personally know anyone who is. But I recognise the injustice of it when I see it.
https://www.dotas-scandal.org/what-is-the-dotas-scandal/apn-f-a-q/
* Though reading some of the reports around - since I do have a business, there is scope for HMRC turning round in a few years and challenging a previous tax return. Since
they are able to pull numbers out of their backsides, the fact that any tax due couldn't possibly be a significant amount doesn't mean they can't turn round and demand an amount I don't owe and couldn't pay.
I've also first hand experience of asking HMRC what should be a simple question and finding them either unable or unwilling to answer it.