Sub contractor tax enquiry

I will try to keep this short so please bear with me. Roughly 12 months ago HMRC opened an enquiry into the 2009/10 tax return of a subcontractor.  At that time my client didn't want to incur my fees to handle the enquiry so against my advice he took over dealing with HMRC.  The enquiry has been dragging on because my client has been ignoring the letters and then went to work overseas for a few months. 

When preparing the 2009/10 return he only provided me with 4 months worth of CIS vouchers.  He maintained that he has only worked for 4 months (very bad year), so the tax return was submitted on this basis, showing gross earnings of £3,780.  Anyway HMRC have since forwarded him a schedule of CIS vouchers which shows he worked for 5 months and earned £6,820.  He now accepts that perhaps he was wrong and that he didn't receive or retain all the paperwork he should have.

Last week he showed me the most recent letter from HMRC, which is asking for copies of all bank statements into which self employed income were deposited.  Having previously told HMRC that he was supported financially by his partner along with occasional monies lent from bank of mum and dad.  The letter also asks for details of what his partner earns and copies of bank statements from mum and dad showing where they lent money to their son.

My first reaction is to tell HMRC to bugger off as their requests are not reasonable to the enquiry.  Having read the all the previous letters from HMRC to my client I get the impression they are on a fishing trip.  I was just wondering if this was a client of yours how would you approach this enquiry with HMRC?  All thoughts/comments welcome.

Comments
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Yes and no

PennyC |

Happy Days

bduncan |

Expenses

valentino rossi |
valentino rossi's picture

I have to say that I feel that HMRC requests ARE reasonable

SteveOH |
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@SteveOH

rockallj |
rockallj's picture

@rockallj

SteveOH |
SteveOH's picture

@SteveOH

rockallj |
rockallj's picture

@rockallj

SteveOH |
SteveOH's picture

I have nothing to add except to say...

justsotax |

The Compliance Factor

Robert Clubb |

Loans

anndartnall |

SUBCONTRACTOR TAX ENQUIRY

weaversmiths |
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