Self employed trader in mainly cash business hasn't kept records of cash in & out of the business separate from personal cash. The revenue contend that by assuming drawings were taken out the business at the same level each week (not correct) this would result in negative amounts therefore more money must have been received. If the cash flow was reworked to show more realistic seasonal drawings then the negative balances would disappear.
The traders problem is that he didn't keep records or count cash at any time as he thought that keeping copies of all sales/purchase invoices and keeping records of cash sales would be sufficient.
The revenue can't prove that undisclosed sales took place but neither can the trader prove they didn't.
What is not in dispute is the fact that insufficent records regarding cash reconciliations were kept or that personal & busines money were kept separate.
The revenue suggested a negotiated settlement.
Is this worth taking to appeal & what would be the chances of winning? - I know, how long is a piece of string but if anyone has any experience of this sort of investigation comments would be appriciated.
- Do I need to report this to SOCA 2,648 25
- Have I dropped a major clanger? 498 10
- Errors in prior year accounts 851 23
- Director forgot to take salary for 2013/2014 2,350 18
- What is going on with VAT applications?? 1,985 39
- VAT & capitalising 133 3
- Final year's accounts 160 1
- Do I Need A Balance Sheet? 314 5
- Self Assessment Tax Return Penalties 306 5
- Entrepreneurs relief available? 314 7
- Filing FPS early with moneysoft 255 15
- Have we a distribution when we reduced our capital but it hadn't been registered? & tax implications in winding up 149 2
- What are options for non CA firm 1,982 36
- Invoice Help 256 7
- Summer evenings and ponderings of capital allowances 193 3
- Employee overpaid who has left 262 4
- Limited Company keeping receipts 246 3
- Sorry ignore me 915 24
- Donaldson v HMRC case being heard tomorrow! 598 5
- Free Shares ? 252 2
- Proposed Amendments to IAS 1 625
- Property exchange - 8-year legal delay following fall-out 534
- SAGE Payroll Data for Import to MS Dynamics AX 298
- Cancelled 285
- Cancelled 245
- Have you staged yet for auto enrolment? 195
- Sage Report Designer - Nominal Activity in Currency 192
- Probiz 180
- Married woman dies owning marital home 170
- What's the market like for temps? 168