HMRC investigation hotspots: Financial reporting

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Steve Collings outlines the areas of financial reporting most frequently picked up by HMRC for investigation.

My last article on HMRC 'hotspots' looked at five of the most commonly investigated areas and how HMRC's technical accountants assist inspectors during the course of an enquiry into a company tax return. Continuing from that, this piece will highlight some other aspects frequently assessed by HMRC in the area of financial reporting.

Directors' private expenditure

Situations can arise where a company will meet the cost of certain private items (this is particularly the case with clients in the SME sector) – in particular motor expenses such as road tax. Be careful with these because the bookkeeper may not be aware that such personal expe...

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Steven Collings
Audit and Technical Partner
Leavitt Walmsley Associates Ltd
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By Anonymous
26th May 2010 10:08

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Another really useful article Steve. Thanks for sharing.

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By Anonymous
26th May 2010 11:27

treatment for fish that are caught

HMRC seem to have no mechanism for spotting obvious cases where one can see potential tax loss from the accounts filed at companies house, let alone the full set provided to HMRC.

Also our experience is that companies house and HMRC will accept non compliant accounts whether a directors report is present or not. Many small companies do not prepare full accounts and get away with filing only abbreviated accounts with HMRC (yes they should have been rejected but are not).

An interesting article none the less, but we could do with some enforcement in the field to support those that do comply with the rules.

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