HMRC Targets SMEs Over VAT

According to figures released following a Freedom of Information request it has been revealed that HMRC recovered £3.5bn in VAT from SMEs in 2014-15.

The figure accounts for almost half of the £7.7bn in unpaid tax recovered by HMRC’s specialist local compliance teams during the period.

Also revealed in the figures is that it is estimated that SMEs make up for 44% of the overall tax deficit in the UK, with HMRC continuing to put pressure on the businesses in order to recover unpaid tax.

In some cases, the businesses may have made an innocent oversight on their tax return which would therefore place them on the radar of the local compliance teams responsible for investigating SMEs.

Businesses should ensure that they are on top of their accounts in order to relay accurate information to HMRC about their tax position and to therefore limit the exposure to potential tax investigation. Over recent years HMRC has targeted certain industries in order to reclaim unpaid tax.

With the closure of 170 regional offices, HMRC will be employing local compliance teams to carry out investigations. The Revenue has also invested £80m in its sophisticated software system in order to enhance the tools in its armoury. The Connect system is able to access and gather information about businesses and individuals in order to support the tax investigation process.

HMRC is continuing to clampdown on tax evasion (deliberate evasion of tax) and tax avoidance (tax avoided mistakenly) in the UK in order to reduce the overall tax deficit.

With more sophisticated systems and specialist taskforces the net is closing on both businesses and individuals.

Our team of tax investigations professionals have considerable experience in assisting clients through investigations, in making voluntary disclosures and dealing with HMRC.

To discuss your case in complete confidence you can call us on 0113 387 5670 or fill out an Enquiry Form with your contact details and we will contact you straight away.