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Vat inspection what do we need to do?

Bookkeeper does vat returns

anonymous due to nature.

LTD company Client, we do end of year accounts. Client has an independent bookkeepe who completes and submits vat returns. As part of the end of year work we liaise with the bookkeeper, identify any errors and provide adjustments to the vat for approval and then she submits error corrections/adjusts on the next return.

the client is having a vat inspection, HMRC visited him, his bookkeeper was not available so they didn’t get far with anything. They are visiting again in January and the client had advised they have requested us to attend bring his accountant. We are not the registered agent for vat and do not submit the vat returns. We have received no HMRC correspondence.

Is it normal for them to request us to attend given we are not responsible for the vat and aren’t the registered agent? Or is the client trying to get us to attend in order to lead the meeting?

i have said to the client we will attend and I plan on taking our vat correction information and outline the process ie the bookkeeper completes and submits the returns and we identify errors and advise. 

Is there anything else anyone would recommend that we do/need to do to ensure we don’t get dragged into an investigation unnecessarily?

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07th Dec 2017 16:56

I would ask your client why they are asking you to attend, not us.

The question the client should be asking you, is why are you letting them go out again?

I would recommend getting advice from someone who deals with this area if you don't know what you are doing. Its not hard, but you need to have some backbone and understand HMRC's powers and when to push back or you will be failing your client.

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07th Dec 2017 17:12

You are anonymous due to nature? Interesting.

If you think you have nothing of value that will assist your client then you shouldn't waste their money by attending. However, I think that any professional accountant would understand how important it is that the client is represented to help ensure they are treated fairly by HMRC.

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07th Dec 2017 17:32

Client having VAT inspection. Rarer than they were, but not unusual
Client has own book-keeper. Not unusual
Book-keeper does returns. Not unusual
Nope, I'm not seeing anything about this query that merits anonymity.

If nothing else, you haven't had anything to do with returns since the last year end, so you can't comment on them. If you're going to attend you need to at least review those.

The book-keeper is probably the one that should attend. HMRC are looking to speak with whoever prepares the returns. They have asked for the accountant, but that is just because they expect you to have done it.

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to stepurhan
07th Dec 2017 17:39

It might be that both accountant and client are members here.

However, if that is the case I suspect the client would sense that their own circumstances mirror precisely the circumstances set out by the OP. The only new matter the client will have learned is that their accountant shows signs of lily-liveredness.

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07th Dec 2017 18:09

Can't see the problem attending. In my experience with VAT control visits the VAT staff are usually pleasant and fair (or have I been lucky?) You don't say what records are kept or whether the VAT submissions just fall out of the software (as with much maligned SAGE).

I'd go along with an open mind and find out whether the bookkeeper has a decent system in place. It seems that from overseeing the bookkeepers work at the year end there aren't any serious problems (or none thus far mentioned).

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By Tornado
07th Dec 2017 20:47

What does your Letter of Engagement say?

If your assistance constitutes additional work, then advise the client of this and quote accordingly. If the client accepts, then you will both know exactly where you stand.

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By Slim
08th Dec 2017 08:15

If it was my client I would go, but that’s because our clients would expect us to advise on the non day to day vat.

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08th Dec 2017 21:11

I'd be quite happy to go along but make it clear through a letter that your time is chargeable.

Very odd that HMRC have requested you attend - not seen that before with a VAT inspection. It could be that during the first visit they saw details of your communication with the book-keeper where you say you offer advice on VAT adjustments /errors and they want you to explain a few things specifically. More than likely your client , when asked a question, likely said "oh you better ask my accountant, he/she said to do that".

Good luck, they aren't ogres (usually).

Btw - if you have a client who is making continual errors, it is worth talking them into taking fee protection insurance, being high risk.

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