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Posts Tagged ‘HMRC’

Is Current VAT System Disrupting your cashflow?

Monday, March 26th, 2012

Are you considering importing and exporting goods to and from outside the EU?

If so, you should be aware that many such British businesses claim to suffer cash-flow difficulties as a result of the alleged inefficiency of HMRC’s VAT reimbursement system.

Whereas the date upon which a company’s VAT needs to be paid is fixed under the Deferment scheme, HMRC do not repay the money on any fixed date.  HMRC argue in their favour that they aim to authorise at least 90% of correct VAT repayment returns within 10 days of receipt, but because some returns are selected for credibility checks, they cannot specify a particular date on which the money will be repaid.

HMRC call temporary halt to record-keeping checks

Monday, February 20th, 2012

On Friday 3rd February, HM Revenue & Customs (HMRC) called a temporary halt to its controversial programme of visiting small businesses to check up on the quality of their record-keeping: “Business Records Checks” (“BRC”).

The pilot programme made 2,437 checks between April 2011 and January 2012.  28% of the businesses visited had some issue with their record-keeping, and an additional 11% had problems serious enough to warrant a follow-up visit.  Various accountancy bodies, however, have been campaigning for HMRC to tone down the way it conducts its checks, as they are purported to be overzealous.  Richard Summersgill, HMRC’s Director of Local Compliance, conceded, “After reviewing the pilot programme and listening to the views of businesses and representative bodies, we acknowledge the need for a fresh approach to business records checks.”

As a result, HMRC are likely to cut the number of visits made very year from 50,000 to 20,000 – which means that the initiative will only raise a quarter of the amount of money which HMRC would have otherwise gained – that is, approximately £124m instead of an estimated £600m.

While small businesses can breathe a sigh of relief to a certain extent, Off To See My Lawyer strongly recommend you remain vigilant over the quality of your record-keeping!