No one wants to be investigated by the tax department, but should you receive an ominous looking, brown envelope informing you of this, stay calm.

The HM Revenue and Customs (HMRC) often investigate businesses, especially if you are VAT registered. Routine tax audits are much less common with income, or corporate tax.

The first thing to do is source a reliable tax advisor, who will understand how HMRC operate, taking all the emotional stress out of the affair.

The experts will also be able to tell you why the investigation is taking place.

TAX TAX TAX 2

Here are some tips to facilitate a smooth enquiry,

• Do not lie to HMRC, as this is the main reason for a jail sentence. Listen to the advice of your tax consultant, who will always tell you that honesty is the best policy.

• Do not destroy evidence. If you do, HMRC might think you are trying to hide something, and they may dig deeper.

• Be honest with your tax advisor, after all he is on your side, and cannot do his job properly if he does not have all the facts.

• Prepare well for all meetings, which brings to mind the phrase, "No one prepares to fail – they fail to prepare." Inability to provide the correct information can label you as "uncooperative", which may mean a more severe penalty.

A suitable settlement

The objective of your tax consultant is to facilitate an agreement that is acceptable to both parties, at the lowest cost to the client. The tax inspector will likely make a visit to your business premises, and if one can provide all the necessary documents during this visit, the outcome is more likely to be in your favour. The consultant will respond to all requests for information from HMRC, giving you the peace of mind that the investigation will result in a positive outcome. Companies like Associate Services can help those under tax investigation, with experienced consultants who know how to deal with all aspects of taxation. A tax investigation can take several months to complete, and from the very outset, your tax consultant will be the one in communication with the authorities, making certain that all goes well, and all their requests are handled promptly and efficiently

A satisfactory outcome

Once your tax advisor has reached an agreement with the taxman, he will also be able to guide you, so as not to reoffend, which can result in very severe penalties. Many people incorrectly assume that HMRC is all about trying to catch people who avoid paying tax. It is quite often the case that the taxpayer has not provided the correct information, which leaves the revenue department unclear about some issues. So, the investigation is merely a way to clarify the details, and to point you, the taxpayer, in the right direction, making everyone's lives a bit easier. Of course, by hiring a professional at the outset, one would avoid this situation. The reasons for using an experienced consultant are many, this guide to tax investigation will give help give you more of an insight.

Comment Here!

comments