Revenue section 9A enquiries

Revenue section 9A enquiries

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Penalties charged on tax arising from a 9A enquiry - change in attitude?

The Revenue raised a 9A enquiry in respect of one of my clients where it transpired that a P11D item had been ommitted from his Return. Once this was clarified I was surprised to receive a suggested "offer in settlement" which included penalties of 15% on the basis that he had submitted a Return negligently. Does this signify a change in attitude or have I just been lucky up to now as this is the first time penalties have figured in a 9A enquiry.
John Heath

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By deanshepherd
06th Jun 2005 12:14

Lucky you!..


I think it depends on two things:

1) Whether there was negligence; and
2) The mood of the Inspector at the time!

Most cases of mine that have resulted in further tax, due to 'differing opinions' on amounts included in the accounts, have usually escaped any penalty.

Of the few cases where there was omitted income (as in your P11d case) the Revenue have taken stiffer action and applied a penalty.

The penalties are mitigable and it may be worthwhile getting the client to make an immediate settlement and try and get the Inspector to reduce the penalty.

Dean
www.mmi-online.co.uk

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By User deleted
06th Jun 2005 12:50

Political Consequences
This is an ultimate consequence of the need for the Chancellor to raise more funds from tax. It is political suicide for the government to raise the basic rate of tax. Equally, HMRC has not really confronted 'big business'. So it is the unfortunate small businesses and private individuals who are confronted by what is euphemistically called 'compliance and investigation'. I suspect that Inspectors have been told to maximise amounts recovered from self-assessment enquiries.

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