Business record checks
The HMRC will be carrying out ‘Business Record Checks’ to 50,000 SMEs annually and is set to start implementing this later in 2011.
Businesses which are going to be targeted are those that employ less than 250 employees and turnover less than £50million.
HMRC have stated that poor record keeping is a problem in around 40% of all SMEs and that the research undertaken shows that up to 2 million SMEs are underpaying tax because of this.
Using the powers of Schedule 36 Finance Act 2008 HMRC will check business records and impose penalties and therefore reduce the tax losses to the Exchequer that result from poor business records.
These checks can result in a fine of £3000 should the business not be keeping adequate records.
HMRC will not only benefit financially from imposing these immediate penalties, but also by ensuring that businesses provide accurate tax returns in the future and the number of businesses keeping poor records significantly reduces.
The Revenue believe however that these checks can benefit some businesses;
- Opportunity to ask questions about record keeping and compliance requirements
- Reduced likelihood of a subsequent compliance intervention or a full investigation if record keeping meets obligations
- Improved financial management which leads to an improved chance of business success
The Revenue has published a fact sheet ‘keeping records for business – what you need to know‘.
If that is a bit baffling then why not speak to Saylavy who will be happy to provide a free initial consultation.
Depending on your business needs we are happy to provide training so that you can do your own bookkeeping or to do your bookkeeping for you either monthly or quarterly, at your place or ours!
Just ask ‘sara saylavy’!