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Business Records Check

Business Records Check

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And so the much-threatened Business Record Checks letters arrive.  I expected the odd one - but for some reason I have 11 on day one,  All of them giving a couple of weeks grace to contact them or to await a call in a couple of weeks time from them.

The letter posits three conclusions from their chat - (a) Fine, you can go on your way, nothing to see here, (b) we'll invite our Business Education Support Team to contact you to offer re-education and (c) we'll be round to check your records.  In general terms our clients are pretty clueless and their bookkeeping varies from plastic bag techniques to itemised spreadsheets.  A couple of clients on my Day One list will be ringing them, but the volumes being selected here appear very high and I can't think they'll have the manpower to chat through things properly.

But then maybe it's me being picked on.  Does anyone know the volume involved with this exercise?

Replies (14)

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By Trevor Scott
09th Nov 2012 15:40

As long as...

...your clients records are fine I'd advise each client to politely decline; drafting a standard letter for them to use, to the effect that any further communication about the matter has to be via yourself as agent..

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By andrewdiver
13th Nov 2012 12:24

I just called the business records check number as we received an agent copy of the notice.  They accept agents responses and it is a quick process to answer the questions and put the clients mind at rest.  But remember you need to know about your client as they have to ask the questions to you as if you are the client as they don't have an alternate questionnaire.  

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By MarionMorrison
19th Nov 2012 16:39

The Actual Questions

The call centre to whom you speak is staffed by people who don't really know anything about tax, bookkeeping, accounts or anything.  They just ask their questions and out pops an answer that tells them what happens next - whether it's (a) OK, (b) we'll phone you or (c) we're coming round to re-educate you.

The questions appear to be standard and they ask:

How Long in Business?

How many income transactions per month? - 1-10, 11-20 etc

How many of these are in cash?

How frequently are income transactions written up?

How many expense transactions per month? - 1-10, 11-100 etc

How many of those are in cash?

How frequently are expense transactions written up?

Can you discern personal transactions from business transactions in any records?

The point-scoring of answers that then happens determines What Happens Next.  I have learned that very low percentage cash transactions is Good, but the key thing is frequency of keeping the books.  Weekly/Fortnightly seem to be fine, but Monthly is a black mark.

We do the bookkeeping for one chap and he sends us material monthly.  When I rang on his behalf and was honest about this, it resulted in him going to receive a phone-call which will be fun, since he just shoves it all in an envelope and we do it.  But they don't want to talk to us about how the books are kept.

Because the vast majority of our clients are low-turnover, London-based sole-traders, we seem to be taking the brunt of this (over 3% of all clients have now had a letter) because that region comes first.  I just hope it's all done and dusted before Christmas.

I'm sure we could make more of a fuss about this, be obstructive about it, but the truth is that it makes more sense to use scripted responses to their scripted questions that just get them off our clients' backs irrespective of the actual truth, all of which makes it an increasingly ridiculous exercise.  

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By Mmoneypennyy007
23rd Nov 2012 18:38

Having an accountant/agent/representative answer on your behalf automatically gives you more than 2/3 of the score needed to bump you to visit level. Fact. Revenue are scoring differently for taxpayers not answering the questions themselves.

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By colinhowe
01st Dec 2012 22:32

Having an accountant/agent

Mmoneypennyy007 - Dare I ask if you have inside knowledge ??  MarionMorrison's detailed response above ["The Actual Questions"] makes considerable sence to me  -  as I'm sure it probably does to other practitioners....  - or, am I just being naieve??  My first BRC on a client arrived this morning and whilst I wouldn't say I was expecting it on that particular client, I had obviously known for a while that as a Hairdresser dealing in 90% cash she would be a prize target and consequently have always tended to "go-the-extra-mile" in my thoroughness on her affairs. So, my question is - to anyone feeling 'brave enough' to answer is what really would give the BEST outcome for the client - ie, the one which would involve the least hassle for all concerned?? Anyone?

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By colinhowe
01st Dec 2012 22:41

PS to my earlier post.....

...I meant: Would it be best for me as Agent to make the call or, leave the client to flounder? I think the records are pretty good but, of course, she is not a book-keeper!

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Replying to Briar:
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By saeed409
19th Dec 2012 21:01

agent always

Clients prefer Agents to deal with HMRC.

 

 

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Replying to jon_griffey:
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By MarionMorrison
20th Dec 2012 09:08

But see above

saeed409 wrote:

Clients prefer Agents to deal with HMRC.

But see what Mmoneypennyy007 says above - that the fact that an agent rings actually counts against the client in terms of their bookkeeping advice.  It's all very well saying clients prefer agents to deal with but if the outcome is having some creepy bloke from Revenue Business Advisory turn up to poke through the books and steal the chocolate Hobnobs that are rightly yours, then they would have been better advised to suck it up and answer the Revenue's questions at the time.

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By frankie3
03rd Jan 2013 15:10

If a client (or agent) was less than economical with the truth when answering the questions for the business record check,  and a client then had an enquiry later from HMRC due to some other reason, and they found out that the records were not as "good" as was stated in the business record check, would that then not have dire repercussions?

 

 

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By MarionMorrison
03rd Jan 2013 15:33

Don't think so

An enquiry is into the accuracy of the figures within a Return.  If you can show how the figures in the Return are justifiable and backed up then there would be no further action.  If the figures were unjustifiable because you'd made them up then yes I suspect they'd be less understanding of a lower standard of bookkeeping giving rise to these circs.

 

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By frankie3
03rd Jan 2013 16:38

what i was thinking was that if you told HMRC during the business record check telephione call that say 95% of your income and expenditure was by cheque (not Cash) when the actual figures may have been more like 50 / 50.

by saying 95% were by check you probabaly avoid a visit whereas in a 50 / 50 scenario would would have one for sure

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Replying to Tim Vane:
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By V7rry
08th Jan 2013 21:24

BRC
Hi have received a similar letter and just wondered if you had spoken to HMRC yest and if so how did you get on?

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Image is of a pin up style woman in a red dress with some of her skirt caught in the filing cabinet. She looks surprised.
By Monsoon
06th Feb 2013 12:36

BRC

Hi

 

We've just had one of these lovely missives. Can anyone confirm that it is true about agent replying actually prompting a visit? I want to take the pressure of the phonecall off my client, but I'd rather she did the call with me present if my taking it off her will cause a visit.

 

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By property12
02nd Sep 2013 13:12

Business record check

I had a letter from HMR & C for business record check in August . I called the business records check number and after a couple of question, they suggested that they would like to come and visit me at my home end of the months!. I am not sure what kind of record they want to see or what kind of questions they are going to ask? Will they review the records or ask questions ,What ,What .....Any help?

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