Who you need to call when HMRC comes knocking

You'd be surprised how even the toughest of business owners lose their heads when a HMRC investigation comes knocking. They can multi-task, be ruthless and unflinching, but upon receiving notification that their business will soon be overrun by HMRC's finest tax inspectors, hungry for a kill to fill their prosecution quota, grown men crumble.  

Surviving an HMRC investigation: the whats and whys

  Even when you know with certainty you've done nothing wrong, there's that niggling voice asking why? There must be a reason, right? Has one of the team been fiddling or cut a corner? Maybe somebody in the office made a mistake? It's possible a few of the company perks you've enjoyed might not, on inspection, qualify as expenses...   And then there are those of you who are just not very organised and always fear the worst. Excellent at what you do in the field, but hate paperwork and will only do minimal (legally required) form-filling and filing, meeting demands only when the reminders have fine amounts printed on them. If you're this type of business owner, chances are receiving notification about an HMRC investigation will either have you reaching for your passport or frantically phoning the smartest people you know.   Sometimes, the way these official letters are worded do put the fear of God into you. They are supposed to. But once you understand them, which are serious and what you need to do to be prepared for the inevitable, it's just another day at the office. Promise.  

HMRC investigation triggers: random or targeted?

  First, treat any HMRC enquiry into your tax affairs seriously. You could go years without being the subject of an investigation, but if you ignore their enquiries, you can be sure you'll start to hear a lot more from your new friend the tax inspector. Triggers for an inspection are usually completely random or are have been chosen due to inconsistencies or errors in annual tax returns. Sometimes they receive information about fraudulent business activity. In the case of errors and inconsistencies, it's usually an 'aspect' enquiry, and considered less serious.   Any business can be selected for a random tax inspection, but SMEs in high risk areas are more likely to be picked because of things like historical factors. It's like being lumbered with higher car insurance because you live in an area where car theft is prolific. These can be either 'random aspect' or 'random full' enquiries. Regardless, you'll feel the heat and want to call upon your favourite superhero.   Don't feel victimised. HMRC say they're: 'just trying to help businesses get their tax right.' You may have a raised brow or you may welcome their friendly advice?

You don't need Superman to save you, you need...

  Don't pick up the phone and put on your best serious/business voice just yet. Yes, you do need to speak to them, but wait till you've got someone in your corner first. Not Superman, but a decent accountant, hardy survivalists used to navigating HMRC's tax terrain. A superhero nonetheless. Contact Haines Watts today on 01472 355215 or email grimsby@hwca.com to speak to one of our chartered accountants in Grimsby.