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HMRC announces crackdown on poor record-keeping
HM Revenue and Customs (HMRC) has launched a crackdown on poor record-keeping among smaller businesses.
The taxman has already started writing to more than 1,000 business owners warning them that they will be receiving visits from tax inspectors in the next few months. HMRC is calling this initial period a “test and learn” phase, which will precede a full programme of spot checks on businesses across the country.
Estimates from HMRC suggest that around four in 10, or around two million SMEs, do not keep adequate tax records.
Businesses who fail to meet the required standards could face fines of up to £3,000, although HMRC has advised that this will only happen in exceptional circumstances in the first phase of investigations.
HMRC hopes the crackdown will bring in an additional £600 million over the next four years, both through fines and the rise in tax paid by business owners keeping better records as a result.
Although it acknowledges that most businesses will not receive a visit from inspectors, HMRC hopes the fact that it is launching the crackdown will prompt business owners who have not already done so to get their affairs in order.
Ideally, businesses should have tax records going back at least six years and keep invoices, bank statements, paying-in books and details of purchases and expenses.
At Lamont Pridmore, we can help ensure your business’s records are in order. As experts in business and tax compliance, we know exactly what the taxman will be looking for, right down to the finest detail.
We can help in a variety of ways, from taking care of your time-consuming bookkeeping requirements through to helping you implement efficient accounting systems, accompanied by full training.
We can also offer insurance to cover the cost of professional fees arising from HMRC investigations which can often cost thousands of pounds. With prices of just £30 per year for personal tax clients, £90 per year for sole traders and partnerships and £150 for limited companies these policies represent excellent value for money.
We can’t predict when the taxman will come knocking at your door, but we can make sure that you have nothing to worry about when he does.
For further information on how we can help, please contact us.
