This is basically VAT evasion/fraud which is a crime. You need to be careful of your position and when and if to make a SAR is your call. Having said that, by your own statement, this is not suspicion but actual knowledge.
LIke any business, HMRC will have parameters they will look for and it is possible to source valuable information on those. It is also important to know how your taxi driver client should be performing as any surpression of takings or expenses can be viewed as money laundering.
As has been said the mileage on a vehicle can easily be identified and then HMRC will have a model to work out `engaged` mileage in the area the taxi driver operates.
We have a large section of taxi drivers from various areas including London and an investigation is very rare. There are easy to keep taxi driver accounts books available.
Tax drivers are great talkers and if you do a good job you will get referrals not just taxi drivers but anyone who gets in the cab moaning about their accountant. Our greatest referral was to a well known television and film actress who then referred us to other `names`and so on.- Carry on Cabbie!
If handing over is creating costs to be charged, I would be concerned at the volume of clients leaving. I also agree that handing over documents (in some cases they are the property of the client anyway) and charging is not appropriate.
Which scheme to use depends on how much is being raised. An SEIS will give a tax credit of 50% and an EIS 30%. Dividends can be paid under both schemes but they will be taxable. If any growth is taken as capital after 3 years there is no CGT to pay. The company must be a qualifying one and must remain compliant for 3 years or the tax benefits will be removed. Here is a link to the Enterprise Investment Scheme Association which may be of help and there are HMRC sites on the subject as well.
It is also possible to create a hybrid SEIS/EIS at the same time. At least 70% of the money raised under an SEIS (up to £150k) has to be spent before raising funds as an EIS.
The share structure and issue is a vital component and where some schems fail. Do not issue shares until they are fully paid up. Not one investor can hold more than 30% equity. Investors share percentages also have to be based on the issued share capital.
These schemes are vital for us when raising money for film productions as unlike some of the previous film investment partnerships (now illegal) these are pre approved by HMRC.
My answers
VAT FRAUD
This is basically VAT evasion/fraud which is a crime. You need to be careful of your position and when and if to make a SAR is your call. Having said that, by your own statement, this is not suspicion but actual knowledge.
LIke any business, HMRC will
LIke any business, HMRC will have parameters they will look for and it is possible to source valuable information on those. It is also important to know how your taxi driver client should be performing as any surpression of takings or expenses can be viewed as money laundering.
As has been said the mileage on a vehicle can easily be identified and then HMRC will have a model to work out `engaged` mileage in the area the taxi driver operates.
We have a large section of taxi drivers from various areas including London and an investigation is very rare. There are easy to keep taxi driver accounts books available.
Tax drivers are great talkers and if you do a good job you will get referrals not just taxi drivers but anyone who gets in the cab moaning about their accountant. Our greatest referral was to a well known television and film actress who then referred us to other `names`and so on.- Carry on Cabbie!
HANDING OVER
If handing over is creating costs to be charged, I would be concerned at the volume of clients leaving. I also agree that handing over documents (in some cases they are the property of the client anyway) and charging is not appropriate.
EIS/SEIS
Which scheme to use depends on how much is being raised. An SEIS will give a tax credit of 50% and an EIS 30%. Dividends can be paid under both schemes but they will be taxable. If any growth is taken as capital after 3 years there is no CGT to pay. The company must be a qualifying one and must remain compliant for 3 years or the tax benefits will be removed. Here is a link to the Enterprise Investment Scheme Association which may be of help and there are HMRC sites on the subject as well.
http://www.eisa.org.uk/
It is also possible to create a hybrid SEIS/EIS at the same time. At least 70% of the money raised under an SEIS (up to £150k) has to be spent before raising funds as an EIS.
The share structure and issue is a vital component and where some schems fail. Do not issue shares until they are fully paid up. Not one investor can hold more than 30% equity. Investors share percentages also have to be based on the issued share capital.
These schemes are vital for us when raising money for film productions as unlike some of the previous film investment partnerships (now illegal) these are pre approved by HMRC.
Rob Graham
Graham Associates (International) Ltd
www.graham-assoc.co.uk