Tigi needs your help

Tigi needs your help

Didn't find your answer?

Apparently HMRC have started an investigation stating "I have questions over your ability to meet all your private & personal expenditure from your business profits I therefore would like to see any bank statements and counterfoils from all your personal banking, investments and charge cards"

http://forums.moneysavingexpert.com/showthread.php?t=3748113

Now clearly the Inspector has not got a clue what he is doing by giving away this information, armed with the reason for opening the enquiry how easy will it be for Tigi to have it closed before it gets off the ground? What do you think her response should be?

Replies (12)

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By User deleted
25th Jan 2012 14:53

Tell them to bog off

My late mother had exactly the same problem - she had a small knitwear/quilt-making 'business' that just about kept her in tea-bags for the week, It did return small profits year on year so as far as all were concerned it was a genuine commercial concern (in reality, not much more than a hobby).

That Inspector was a little more cautious at first, not divulging the reason for opening the enquiry, but I very quickly managed to determine her concerns - insufficient profits to live on. As soon as Inspector was told that my father was partner in a large legal firm, paying HMRC six-figure sums in tax each year, case closed!

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Replying to Portia Nina Levin:
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By tigi
26th Jan 2012 23:34

Not you!

Sorry BKD, my remake about being blonde not dumb was not aimed at you but the other person who said I was playing dumb!
Did you late mother get a similar letter than mine ? Because I just read the reply from the black knight, he is under the impression they know something about me, so now I am sitting here thinking what?!!!

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By George Attazder
25th Jan 2012 15:13

Tigi...

.... meet Schedule 36 FA 2008. Schedule 36 FA 2008 meet Tigi. You need to go to a tribunal to tell Schedule 36 to bog off.  My gut's telling me that Tigi's just playing dumb.

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Replying to leshoward:
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By tigi
26th Jan 2012 16:39

tigi

Hi,

I came on here as Mouse said it was be useful, your comments were not useful, and for your information I am not dumb, blonde maybe but not dumb!

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By The Black Knight
26th Jan 2012 10:57

no sympathy

according to the post She has not got an accountant....still does not appreciate the value of that knowledge....the business is run through personal accounts so there is no separation.

Be interesting to see what has been claimed (in all honesty) in the belief that it was tax deductible, a bit like property owners typically claiming the mortgage repayments.

I have just had a conversation with a client who has a tax bill that is difficult to meet (low profits)...he explained that his mates did their own tax returns and paid no tax at all.....

They claim for their dogs and 50 inch monitors etc etc in fact everything except the weekly shop......Yes it is very unfair......will they get caught...probably not.

But I guess when they devised self assessment they knew this would happen (or should have)

Mouse.....I  can see your point and I would have once defended the honour of every young maiden too.

but can now see not all are as virtuous as they first look.

having said that HMRC seem to deliberately pick the wrong cases for something to do......the obvious easy wins they ignore out of awkwardness I think.

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Replying to Duggimon:
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By tigi
26th Jan 2012 17:00

tigi

Dear Black Knight,

I did not use an accountant as my return was so small and I had only 2 things on my expenses.

I have since taken all my returns to an accountant who has checked all my returns, says he see's nothing wrong and if anything I may have undercharged my expenses not overcharged.

I appreciate that not all are " as virtuous as the look" but I would  not come onto a forum in the 1st place had I not been sure I had done nothing wrong.

I have decided to let the accountant represent me, simply because I sadly lost both my parents that year and I do not feel up to explaining some incoming payments related to this, the only thing I am guilty of being, is naive in not keeping a separate bank account for my business.

Its quite shameful of the UK that I am being made to feel like a criminal just because some pen pusher comes to the conclusion that I must be up to no good as I put in a low return, I would understand if they aske me first how I live/ do I have a partner ect, before they ask me to supply all my personal details.

Thank you mouse for trying to get me extra advice on this site.....think I will stick to the other forum, the users are less judgemental,  and like yourself and Jimmo they offer informative and helpful  advice!!!!

 

 

 

 

 

 

 

 

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By The Black Knight
26th Jan 2012 17:35

Glad to hear you have now got an accountant

That is the best thing you can do.

As you may find out you could have saved tax anyway. And I hope you get a result.

Some believe in random investigations but these are rare....I would assume they have some information that leads them to ask that question.

The best thing to do is be cooperative with HMRC as this will count in your favour (lower penalties) if they do find anything....but I usually keep the client well away from HMRC......not because they have anything to hide....but because they often do not understand the question they are being asked. Not because you are blonde but because we as accountants sometimes know where the questioning is leading, very difficult to back track if they have got you flustered.

The separate bank accounts issue is usually a point scoring matter and in the interests of being cooperative are eventually given up.....from experience it is the non business deposits that the client has forgotten where they came from (not having anything to do with the business) that cause the problem.

You may find it is all over in a flash....most of ours recently have been with no extra tax. HMRC are trying to deal with investigations in a more efficient manner.

 

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By ShirleyM
27th Jan 2012 07:15

Generalisation

Tigi ... you are unaccustomed to AWeb. Generally, we are given very little detail, so there is often a lot of speculation as to what MAY have happened, and then we regularly go off at a tangent and refer to earlier clients and their circumstances, as examples.

The only way to stop speculation is to give full details, or respond to the speculation, but this is an unusual post because the 'original poster' was on a different forum... originally.

I am glad you now have an accountant to help you, and hope you soon get the problem resolved to your complete satisfaction.

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By User deleted
27th Jan 2012 08:16

A different time

Tigi, I suspect that my mother's letter was quite different. Her enquiry was opened when Inland Revenue were Inland Revenue, we knew all of the local Inspectors, and they tended to know what they were talking about. Sadly, those times have gone. But her circumstances did seem to be similar to yours - low business profits but fully supported financically by spouse/partner. The outcome ought therefore to be the same, even if procedures are somewhat different now.

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By George Attazder
27th Jan 2012 10:45

It was I

Tigi.  I never said you were a dumb blonde.  I didn't even know you were blonde

My suggestion was that you were "playing dumb" (a term of phrase, rather than name calling).  Either part of your story is being lost in the telling, or you're not telling part of the story, to my mind.  I'm not saying I'm right, it's just my opinion.  It's still my opinion, and I'm entitled to it, whether or not you like it.

Non-dumb blondes understand these things! :)

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By The Black Knight
27th Jan 2012 11:09

Mortgage payments

Would be my guess, dangerous to speculate though.

I was recently asked a security question "can you tell me what your monthly mortgage payments are ? " I failed the security question because I could not remember......But clearly HMRC have this on their screen when they talk to you........Nice to know they knew more about me than I did...the other questions I failed because they had the incorrect information.

If your income is less than those payments then HMRC may well have a reasonable suspicion that not all your income has been declared.......and as you say there may well be other explanations but HMRC will not know this unless they ask the question.

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By tigi
27th Jan 2012 16:10

Mortgage payments

Thank you for the Advice Black Knight, that may well be the problem, but again its due to them not knowing I have a partner who pays half, I am assuming when they see my bank statments they will recognise this and send me on my way.............here's hoping :)

 

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