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Tax Investigations in Uk – a Few Things You Need To Know

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PKAccounting
Tax Investigations in Uk – a Few Things You Need To Know

Well, if you are running your business in UK, you will already know that UK’s tax obligations have the potential to leave even the seasoned accountant into a position of dread. The fact of the matter is HMRC could end up in each of your facts and figures questioning you about everything, every invoice you have recorded and every expense for which you have filed a claim.

The reality is, UK tax investigations are nothing to be feared about. It is just a matter of misunderstanding. You fear when you do not have a complete knowledge about anything. If you are already prepared for your tax filings, things will come is easy for you. Let us now see some details about UK tax investigations.

Meanwhile, if you want to take up accountancy services in London, you can connect with us.

Tax Investigation

In simple and basic terms, a tax investigation is a financial audit conducted by HMRC, which is Her Majesty’s Revenue and Customs. HMRC is a publicly owned department of British Government. A tax investigation is a thorough look into your tax payments. In case HMRC considers you for tax investigation, the team shall connect with you through email or telephone. When they contact you, they will tell you what kind of information do they need and what are the things that they look at. At this point, they can also ask for specific documents of business records from you. HMRC is a legal authority to govern your finances and they can question you anytime.

Before they intervene, it is better that you stay prepared with your tax filing. We know doing it on your own can be difficult and tiring, hire the right accountancy services in London to get that sorted for your firm.

What should you expect during an HMRC investigation?

The detail the governing body will go into and the kind of documents they demand shall depend upon the tax investigations that you shall face. There are three different investigations, they are:

  • Full inquiry – If the team selects you for a full inquiry, HMRC will thoroughly investigate all the aspects your tax history. 
  • Aspect enquiry – Here, HMRC will investigate a specific aspect of your tax. For example, they may check sales tax for your business.
  • Random Enquiry – Last is random one, where they can run a randomized checks into anything they like. 

We always suggest small, medium, and even big enterprises to stay prepared for these tax investigations. You must always file your taxes on time.

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