…season of mists and mellow fruitfulness…Close bosom-friend of the maturing sun…”
BEAUTIFULLY expressed by Mr Keats and vet, it is also a season when HMRC will be doing its level best to bring in more arid more revenue to plug the huge levels of deficit the Government faces.
By now, we all know the myriad devices used by the Revenue to part us from our money — Personal Tax Returns (due end January if you haven’t yet sent your paperwork into your accountant, Company Tax Returns, CIS (Construction Industry Scheme), VAT, Inheritance Tax, Capital Gains Tax, Stamp Duty when you buy a house etc, etc, etc
Not forgetting that I live with a man whose daily breakfast reading material is the Taxation Magazine (we know how to live), even now my head spins!
Many of us would prefer to keep our heads firmly buried in the sand and hope that we don’t need to know the details. Or, we might believe that our businesses and investments are too small to be important, but, believe me, nothing is too small for HMRC to query and to launch an investigation into.
Please note, that even though, by law, we only have to keep records for seven years, I have known people to be chased by the Revenue for information after ten years, and no amount of pointing out that their enquiries have been “timed out”, stops them badgering an individual if they think there might be some money at the end of it.
If HMRC launches an investigation into your affairs, you will, in all likelihood, be glad of the support and expertise of your accountant, who might have been the keeper of your records for a number of years. What many people don’t appreciate is that this expertise does not necessarily come cheap.
A general investigation, for example, can last over a year by the time HMRC has asked every available question — don’t forget to remember what colour you painted the loo door!
Once all is completed, even if you do not have any further tax to pay, the cost of your accountants’ fees accrued during the investigation will land firmly at your feet, not the Revenue’s, The bad news is that they can range from a few hundred to several thousand you depending on the complexity of the enquiries. Now that, with more and more digital submissions being required, the Revenue are spending less time processing and more time checking we can expect even more of these investigations. It’s not all doom and gloom however, because many accountancy firms now offer a sensibly priced insurance against the cost of these fees. In the case of ours, one small business saved in excess of £3,000 in accounting lees over the course of a year by paying a premium of just over £100.
After all that time, their affairs were deemed to be completely in order. If you aren’t sure if you have one of these useful policies, please do check with your accountant. My motto for autumn? “Be Wise to HMRC!” It may not quite have the flow of Mr Keats, but it might stop the draining away of your hard -earned cash .