HMRC VAT inspection
When it comes to running a business, staying on the right side of HMRC is sure to be one of your main concerns. While a HMRC visit is likely to get your heart racing, it’s important to stay cool, calm and collected. After all, if you’re doing everything right, you’ve absolutely no need to panic. A HMRC VAT inspection can be routine and should be planned in advance. It can also be unannounced. So here are our top tips on how to handle HMRC visits.
- Set a Time and Place
HMRC inspections are sometimes disruptive, especially if you’re already battling a heavy workload. So when you’re contacted about a meeting, be sure to set a time and place that suits you. Don’t feel obliged to accept a request from the VAT office that doesn’t fit with your schedule as this will put you under unnecessary pressure. While you can’t escape the hassle of an inspection, you can make it more convenient for your business.
- Make Sure You Prepare
If your inspection is arranged in advance, there’s no excuse for a lack of preparation. Take this into account when setting a date as you’ll need to gather and prepare the previous three years of audited accounts and make sure everything is not only in order but well presented. With a VAT inspection looming, it’s also a good idea to inform your staff about the inspection, delegate any necessary tasks and arrange for the person who compiles the accounts in your business to attend the meeting.
- Take Meeting Notes
When the meeting begins, ask what the inspector would like to check. Let them do their job but ask for feedback and take notes of everything that’s said as well as the overall outcome. If the inspector makes any significant statements, get them in writing and don’t hesitate to ask any questions you may have. If you don’t understand the answers given, keep asking until everything is clear in your mind.
- Be courteous
HMRC inspectors are simply doing their job. They’re not there to deliberately catch you out or make your life difficult, so always be as courteous as possible. Be polite, engage with conversation and offer them office perks such as tea and biscuits. When they arrive, make sure they only deal with you or your chosen representative to avoid any confusion.
- Know Your Rights
If you get a visit that’s unannounced, it can be easy to panic. The inspector may have a formal notice signed by a Tribunal or An Authorised Officer of HMRC. This requests access to the premises, but it doesn’t give HMRC automatic right of entry, and you won’t be penalised for not letting the inspector in if the notice is signed by an Authorised Officer. If it’s signed by a Tribunal there may be an initial penalty of £300, but only if you don’t have a reasonable excuse for refusing entry. Unannounced visits are not random. Therefore it’s a good idea to seek professional advice before speaking to HMRC.
A HMRC inspection shouldn’t keep you up at night but it’s important that everything is in order so you’re not scrabbling around at the last minute. Contact us today for reliable accounting and tax advice and stay above water.
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