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Clients records damaged in flood

Clients records damaged in flood

I have a client who is a subby who declared the incorrect CIS tax deducted on his 2011 return and HMRC picked it up and enquired into the return asking for proof of CIS deducted and also a breakdown of the travel and accomodation expenses.  The client is actually pretty well organised (for a subby) and wrote up all of his expenses in a notebook so I gave a breakdown with amounts of the expenses!  However, the HMRC inspector has asked to see copies of the travel receipts and when my client has gone to get them they have been damaged beyond recognition apparently due to the recent floods!  Convenient I hear you say....

Where does the client stand now?  As you would expect a lot of the expenses were paid cash (should they just lock him up now?) and they can't remember all of the places he stayed to try and request duplicates!



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31st Jul 2012 17:45


What I would do is get some photos of the damaged receipts,  the address at which they are stored (which is presumably his home?) and link that to flooding reports in the newspaper. This proves he isnt a liar with third party evidence (unless of course he is.........)

That proven, it might be enough. Failing that, ask HMRC to pick a sample of say 10 receipts and then your subby better put his thinking cap on and try and remember where he was, get him to check his sales invoices/diary etc, and go back to the hotels and get copies. Its only going to be the big ones you need.

Or (as we have had recently) if HMRC refuse to pick a sample, ask your subby what the most likely ones to get hold of are, and tell HMRC what sample YOU are picking, and supply those as best you can .Eg all those in a two week period.

Really its going to be down to convincing the inspector he is not lying through his teeth, and you for that matter too!



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By twj4789
31st Jul 2012 18:29

Agree with above

Potentially there would also be an insurance claim for damaged property which would verify some general flood damage.

You could consider other ways to verify the expenses. Did the breakdown have dates and business names and individual amounts? I so these could be verified against bank or creditcard statements etc?


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01st Aug 2012 08:58

Does "beyond recognition"

Does "beyond recognition" mean they have as a result been thrown away. If they still exist in some form why not send them to HMRC as proof of the flood and your client's veracity

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01st Aug 2012 09:22


Agree with the insurance claim, far better idea than mine.  You certainly need some good third party evidence, moreover if you *offer* it you will tend to find you have to gather far less than if it is *requested*.

Even flood damaged receipts would still look like a pile of receipts....

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By Tosie
01st Aug 2012 19:19

If all above fail:

Establish with help of main contractor sites worked and prepare mileage records based on sites.If it is out of town work check how many nights and work from there..

I would expect an organised "subby" would have this info in their notebook.

I assume that the inspector thinks the claims are too high but if you can identify sites they will normally settle.

As for CIS records HMRC already have them suggest the inspector presses a button on his computer.

Be careful as HMRC may know  something you don't e.g the client always worked on local sites.

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02nd Aug 2012 09:29

I like the idea of sending defaced records to Inspector.Could the same principle apply to a farmer?If so we could send the offending truck load of manure and cattle responsible!

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07th Aug 2012 12:29

I believe that destruction of

I believe that destruction of records by a flood is a reasonable excuse for not being able to produce them to HMRC.

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07th Aug 2012 15:55

Client's records burned by his son

Had a sole trader a few years back whose bookkeeping records, all parcelled up to post to me, were put in the wood stove by his son. Apparently they burned really well! So I just prepared his accounts based on his previous year's P&L and Balance Sheet, adjusting all "lost" income and expenses up by 10% (this was when the economy was in growth), and tying things in as best as possible to the closing bank balance and those figures we knew (such as recurring direct debits, standing orders, etc) ... told HMRC what I had done, and they accepted this without a murmur.

Then, the next year, compared the lost year with the year before and the year after, and adjusted the lost year to fit in with the overall 3-year pattern, again told HMRC what I had done, and just put the prior year adjustments in with the current year's figures. To be fair the adjustments needed were only minimal. Again this was accepted without murmur.

Client didn't want to claim for anything on insurance, since his premiums would have rocketed. And since I didn't have to charge any more than my customary annual accounting fee, this was fine.

This did happen over 10 years ago.

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