VAT Investigation
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HMRC conducts compliance checks to ensure the correct amount of indirect tax, primarily VAT, has been paid. These VAT investigations typically involve a visit to the business premises to review records and address any questions that arise. While these visits are usually scheduled, HMRC can sometimes arrive unannounced.
DESCRIPTION
Typically, HMRC will inform the taxpayer in advance which records they wish to examine, covering both current year records and those for previous years with submitted VAT returns.
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Taxpayers have the right to have their tax adviser present to assist with any inquiries during these visits.
The legislation authorizing compliance checks also imposes various restrictions on HMRC's powers during these checks.
At any point, HMRC can escalate a compliance check into a more thorough tax investigation, especially if significant errors are discovered. This investigation can extend beyond VAT to other taxes.
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VAT Fraud & VAT Evasion
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In addition to standard compliance visits, HMRC conducts serious VAT investigations under Public Notice 160 when there is suspicion of dishonest conduct. These cases often involve large amounts of VAT and suspected fraudulent activity by the taxpayer.
How We Can Help
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During n HMRC VAT investigation or compliance check, taxpayers are entitled to have a tax adviser present to help manage any questions from HMRC. We can serve as your adviser during these checks.
It's crucial for taxpayers to understand the legislative restrictions on HMRC's powers during compliance checks. Many accounting firms are not fully aware of these powers. As a specialist tax investigations firm, we stay updated on the relevant powers and restrictions to ensure HMRC does not exceed their authority.
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Our tax experts will manage the flow of information to HMRC, ensuring you are cooperative without compromising your position. We will discuss any apparent discrepancies between the VAT Returns and your records with HMRC to reach an agreement. Our goal is to minimize your VAT liability and any associated penalties, and to handle the investigation professionally to prevent any potential naming and shaming.
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If HMRC has notified you of an impending VAT investigation or compliance check, please contact us for a free, confidential, and no-obligation discussion. We are happy to offer an initial free meeting with prospective clients