- contact & find
-
your local office
get phone numbers & directions, or freephone...0845 555 8844
- Businesses need to be aware of new powers given to HM Revenue & Customs…
Tuesday 06 January 2009 -
On or after 1st April 2009, HM Revenue & Customs (HMRC) will have new powers to access businesses in order to inspect the premises, business assets, business records and remove or copy documents. If businesses resist or obstruct the taxman in his ‘inspection’ or refuse to allow access, he cannot forcefully enter but there is a risk of incurring heavy fines and penalties; especially if HMRC suggest any tax is underpaid as a result.
HMRC cannot currently demand to inspect records at a business premises except for VAT and employment tax matters. That is set to change as HMRC believes that the ability to see the business ‘in the flesh’ can give the inspector a better commercial perspective. That may be true, but inspectors may also want to cross check data to prime records such as delivery notes, to inspect assets used in the business or to hold discussions with appropriate personnel. It is anticipated that some notice will usually be given, but an inspection can be undertaken with absolutely no notice at all in certain circumstances. These, together with their existing powers, means that HMRC have a much wider and deeper reach than ever before.
Gary Rooney, Head of Tax Investigations at Dains comments. “For those businesses with their own premises or even those who use part of their home for business this could mean a most unwelcome intrusion by the taxman. This has to be managed properly otherwise penalties and fines can follow and in the very worst cases of obstruction or concealment of documentation there may be cases of imprisonment.”
Another extension of HMRC’s powers recognises the use of computers in storing relevant data. HMRC can gain access to any computer which has been used in connection with the accounting records and supporting documents.
Gary continues. “This is not a completely new development; normally you would expect HMRC to have access to the records themselves, but not usually the computers on which the records have been prepared or maintained. Although the power to do just that has existed for some time, it has not been extensively used until now. The practical implications of this could be significant. You may want to ensure that no other critical business information is kept on the same computer as the accounting records - so the risk of business disruption is kept to a minimum should HMRC require access to the computer during the course of an enquiry or inspection.”
Businesses should act now and consider an appropriate plan of action to deal with an HMRC inspection visit or information request so that they can comply with what is required of them without any unnecessary problems arising in the process. For further information or advice, contact Gary Rooney on 0121 384 9196 or via taxinvestigations@dains.com
Primary offices at… Birmingham ● Burton ● Coleshill ● Lichfield ● Rugeley ● Swadlincote
latest headlines
- Fake Tax Website Warning... (Monday 06 September 2010)
- End in sight for compulsory retirement... (Thursday 02 September 2010)
- Rules on company car replacements are changed... (Wednesday 25 August 2010)
- Government confirms minimum wage rise... (Tuesday 17 August 2010)
- Claiming back the cost of cars... (Monday 09 August 2010)
- Registering to Pay VAT online... (Monday 02 August 2010)
- Automated Tax Bills... (Monday 26 July 2010)
- News Archive »