Five tips to reduce your chances of an HMRC Inspection
Many HMRC inspections are random and cannot be prevented, but there are key ways to reduce the chances of attracting the attention of the taxman.
Here Bevan and Buckland’s Tax Director Lee Bradley gives his five top tips.
“First of all you must file your Tax Returns accurately and on time, and remember the submission deadline for your Self-Assessment online tax return is the 31 January,” warned Lee.
“In order to achieve an accurate Tax Return, you need to keep good records.
“An accountant will prepare your annual accounts, but they can only work from the information you give them. So I would suggest: make book-keeping a priority that will help avoid potential costly mistakes.”
Lee’s third top tip is to pay any tax due on time.
“Always know what you tax bills are and when they are due and make sure you have the money set aside to cover them. That is essential,” Lee insisted.
“Fourthly, always check with a professional if you are unsure about any element of your finances at any point during the year. Don’t wait until the night before the deadline to start asking questions as this may be too late.”
Lastly Lee suggests a tax return should be transparent with information.
“There is a box on the Tax Return for additional information,” said Lee. “Explain any changes of unusual activity from one tax year to the next for example large fluctuations in profits.”
Added Lee: ”The five tips will only reduce the risks of tax investigation and if you do receive the dreaded letter through the post or phone call contact a tax professional immediately.
“Statistically with professional advice tax inspections are resolved quicker and with a more favourable outcome for the taxpayer.”