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Car benefit

My client has been contacted by the Inland Revenue with respect to tax years dating back to 1999.

They claim there is insufficient evidence to prove that my client drove over 18,000 miles in those years.

The company my client worked for has since gone into administration and has not kept any diaries of this time working for that company.

What is the best way to approach the Revenue in this situation

Thank you in advance
sarahkedgley

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By Anonymous
12th May 2004 11:22

thanks
Thanks for all the responses,

My client is not under investigation it is purely a letter from the revenue, other staff have also been contacted.

He is going to the leasing company to see if they have any mileage records of the car.

Should I contact the revenue and ask them what evidence they have, open a dialogue with them - what is the best approach here?

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11th May 2004 11:01

More to this....
than meets the eye.

Presumably P11Ds were submitted by the former company. The dispute must have to do with the company's compliance obligations. Was your client the owner or major shareholder of the company, in which case what else is under investigation? The Revenue don't usually bother with such ancient issues (at least on their own) unless there is a wider investigation going on, relating either to your client's tax returns, the company's or both.

As has already been said, if the client was really doing 18,000 miles a year he ought to be able to remember enough at least about his pattern of life to provide at least some anecdotal evidence.

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By Abacjm
10th May 2004 23:18

Car Mileage Records
Sarah,
i dont know if the car inquestion was over 3 years old at the time, but if so, you could check the mileage on the MOT certificates and that would give the global annual mileage. If barely 18k, it may be more difficult to prove to the revenue theat it was 100% business, but if the annual mileage was say 27-30k then it may be easier. You can also check the fuel records, if his old Co. is willing to co-operate. Presumably, he failed to lodge mileage claims with the Co when they either reported the car as having no business miles or b) when he made a claim direct ot the revenue which was not supported by the evidenec on the p11D submitted by the Co on his behalf.

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12th May 2004 17:45

Investigation?
Sarah - if the revenue are alledging that there is no evidence concerning your clients mileage records, you need to accept that he is being investigated - not in s9A(1) sense, and, we hope, not in an SCO sense either, but they are investigating his affairs and the likely outcome may be a series of discovery assessments, charging tax, interest and penalties. I think you need to review carefully what his relationship with the revenue was at the time, whether returns were submitted, and if so what they said, and as others have suggested any other evidence is going to be helpful.
You need to approach this from a worse case scenario initially, accepting that penalties will be charged unless your client can find some way to prove himself or herself innocent and so bear in mind that the revenue can only mitigate penalties on the grounds of disclosure, with added mitigation if voluntary, co-operation and gravity. Unfortunately not being able to get records, which may or may not have existed from a company that no longer exists is not grounds for mitigation.

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10th May 2004 22:13

Whose diary?
Surely your client should have some recollection of where he travelled for business purposes, and so should attempt to reconstruct his potential mileage log. Relying on a company that no longer exists to keep a diary of his business visits is unlikely to convince the revenue of the reasoinable nature of his mileage records is it?

To be blunt your client needs to sit down and think very carefully about where he went and when, and if he cannot account, reasonably, for a figure even remotely approaching 18,000 miles, needs to consider why the representation was made to the revenue that he did.

It may be interesting, but not helpful necessarily, to discover if other employees/directors etc are in a similar position.

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11th May 2004 10:40

What sort of contact?
You say that your client has been contacted. Has he completed Tax Returns? Is he under enquiry? Has a S9 notice been issued.

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By Anonymous
12th May 2004 00:48

Sorry but

if an employer gets his P11d's wrong then all they are liable for is a penalty for the incorrect forms.

It is an individual's responsibility to submit their tax return correctly, regardless of what is on the P11d. Alternatively if the taxpayer does not recive a tax return it is his responsibility to notify the IR if insufficient tax was deducted from his pay.

If the employer chooses to meet a liability that is a different matter, unliklely where it has entered administration.

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