HMRC investigations: What you need to know

I am slightly concerned to note that Ronnie quotes the TMA 1970 when talking about co-operation with HMRC enquiries.  All mainstream taxes (VAT, CT, IT & CGT) have a single set of information and investigation powers under Sch 36 FA 2008.

The new powers are not to be confused with the old powers as they are quite different and contain quite strong penalties for non compliance! 

Is it in the right place. Isn't the public debt £157bn?

Is everybody scared of the Stasi spies out there? They should be.

"A large proportion of tax enquiries, perhaps over 50%, are started by informants - former business associates, jilted lovers and others" - that is certainly not my experience either from my HMRC days or now : obviously such information might up the risk score, but it would not now be enough on its own. And the future is "campaigns" rather than the selection of individual cases. The article seems to be curiously out of date.

This is a link to guidance on the new powers in Schedule 36 FA 2008. They apply from 1 April 2008.

Virtual tax assistance for accountants and their clients: www.rossmartin.co.uk

According to Liam Fox in the HoC today, it's £799B

The number of hits shows just how much of a hot topic this is.

HMRC has got to get more cash for less work, it's as simple as that.

Nick

www.tax-hell.co.uk

The reason why a lot of people are reading and not commenting is that we have heard it all before.

HMRC are gearing up to have an almighty hit on all tax payers and Accountants. Whatever comments we make won't make any difference. This Government does not listen or comprehend. Mr. Brown has his own agenda and he is determined to stamp out tax avoidance whatever the damage and cost. Why is it that some people in postions of pwer can't see further than their nose????????

This "National Averages for various types of businesses ", countrywide, adopted by HMR&C in their Operational Manuals is absolutely typical of the blinkered "one size fits all" mind of the average Civil Servant involved in Statistics & Data publishing & data processing management at HMR&C & no doubt throughout other departments in Whitehall.

When coupled with the closure of many local tax offices, and the sad lack of transfer to the new Regional Offices in the Capital Cities of each County of all the valuable information obtained on the various trades monitored by those now defunct Local Offices during their Compliance investigations in previous years, is going to lead to ever more problems and time wasting for clients, their accountants, with hugely greater timewasting and inefficiencies in Collecting the greater tax revenues required by Government to repair its own finances.

If someone "at the top" of HMR&C doesn't get a grip on this problem in this coming tax year, then I can see a complete disaster.

In one particular case in my office, the Inspector and his support staff in Lincoln Tax Office have spent an enormous amount of hours trying to extract totally unjustified amounts of tax out of one of my clients, all based on their total lack of ability to understand that the margins of the particular trade in this part of the country bear no relation whatsoever to the National averages!   The final extra tax agreed by the Inspector and his Departmental Manager, has been eventually reduced to such a small figure that the cost to the Revenue  over the last two years of investigation, must be somewhere near ten times the agreed final tax.   My Fees?  I stopped the clock within the first month, as the clients are barely solvent, and I wasn't that worried about the income!  My concern was that if the Revenue took the same attitude with everyone else in the trade in this area, they would all be put out of business.  The local population would lose a vital service and some 50 more workers & firms' owners would be placed on the dole! 

As I'm nearing retirement, I too wanted the vital services these guys provide to be available when I reach my infirmity and dotage!

Terry Hunt,  Mablethorpe UK

With HMRC's current focus of attention on the amnesty front being Health Professionals (the ludicrously named 'Tax Health Plan') this brings up the delightful prospect of a tax investigation officer subsequently meeting a surgeon that he has investigated but this time on the surgeon's own terms (of course that's if any surgeons bother to remain here). What goes around comes around.