Client is a self-employed gardener whose wife works.
Received the usual kind of opening investigation letter but with an immediate demand to see all personal and joint personal bank accounts.
To be honest, the client is a lazy so and so and during the year won £8500 on the horses in one bet (proof of which I have seen) which meant he worked even less than usual!
After review of our file, I am happy that the work we carried out was complete and feel loathe to immediately give the Revenue keys to my clients personal life.
Any opinions?
Paul Evans
Replies (4)
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Be careful..
Any attempt to avoid providing the information to the Inspector is only going to raise suspicion.
It is not uncommon in low income enquiries to ask for all private bank account details. Just go through the statements with your client and make sure there are explanations, preferably with supporting documentation, for any income not included in the accounts.
Dean
Free Online Helpdesk from MMI, the Surrey Accountants.
See Enquiry Manual
The HMRC guidance at EM 1070 suggests that it is reesonable to make the request at the outset where means are thought to be an issue -see extract below
"In checking entries for business income you may consider that sight of the non business bank, building society or credit card details is required. EM2220+ tells you when it is reasonable to request that information. You can ask for private records at the start of your enquiry if means have been identified as a risk or you have already established, for example through telephone contact with the agent, that the accounts are not based on a complete and effective record keeping system EM2221."
If betting wins are put forward as an explanation of cash banked you can expect HMRC to look at that criticaly and require proof that it is what the taxpayer says it is. They will also want to know how much he looses gambling, and to be able to tell them why he can acheive what others cannot which is to beat a system that exists on the certainty that the punter will loose over the longer term.