A new study suggests that small and medium-sized enterprises (SMEs) are growing increasingly likely to be targeted by tax enquiries led by HM Revenue & Customs (HMRC).<\/p>\n
According to reports, the tax authority has been broadening the types of businesses it targets with enquiries in recent years, in a move which managed to net HMRC \u00a3504 million in extra tax in the 2016\/17 financial year alone.<\/p>\n
Analysis of the latest data suggests that the amount of tax collected in 2016\/17 as a result of tax investigations into SMEs was up by eight per cent on figures recorded in 2015\/16 \u2013 and it is suspected that this upward trend will continue as the tax authority continues to sharpen-up its investigation procedures.<\/p>\n
HMRC has been accused of taking an \u201cincreasingly aggressive\u201d stance towards SMEs, amid concerns that such businesses are unfairly deemed \u201ceasier targets\u201d by tax officials.<\/p>\n
The criticisms come amid concerns that HMRC previously only targeted cash-only SMEs, for example, as part of compliance investigations \u2013 yet such organisations are now frequently facing enquiries of all kinds.<\/p>\n
Specifically, in recent years the Revenue has been cross-referencing data of all kinds using its Connect database \u2013 which has been described by the press on multiple occasions as HMRC\u2019s \u201csupercomputer.\u201d<\/p>\n
The Connect system enables the tax authority to cross-reference records with other sources \u2013 such as its Card Transaction programme, which monitors debit and credit card transactions \u2013 in order to identify discrepancies between the amount of income a business declares and the amount of income it actually receives.<\/p>\n
Companies are being reminded that even the most basic tax errors in returns can now be very easily picked up by Connect and often can \u2013 and do \u2013 lead to subsequent enquiries and investigations.<\/p>\n
Businesses should always seek specialist tax advice from the outset to minimise any potential errors which may increase their chances of facing an investigation.<\/p>\n","protected":false},"excerpt":{"rendered":"
A new study suggests that small and medium-sized enterprises (SMEs) are growing increasingly likely to be targeted by tax enquiries led by HM Revenue & Customs (HMRC).<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4,7],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/2102"}],"collection":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=2102"}],"version-history":[{"count":1,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/2102\/revisions"}],"predecessor-version":[{"id":2103,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/2102\/revisions\/2103"}],"wp:attachment":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=2102"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=2102"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=2102"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}