If your business has been selected for an HMRC investigation, you may be wondering how to prepare for the investigation. In this article we will look at getting your records in order and arranging for HMRC Investigation Cover so that you are prepared and ready for whatever comes next.
Get your records in order
Before you can start to prepare for an investigation, you need to get your records in order. This means making sure that you have a good record of:
- Your finances, including bank statements and receipts
- Your customers and suppliers, including any contracts or invoices
- Your employees (this would include timesheets), so that HMRC can confirm who is receiving PAYE tax deducted from their wages by your company
Your activities, including invoices from other companies and correspondence between you and HMRC Your business’s structure (for example, if you’re a limited company or partnership), so that HMRC can determine whether you are liable to Corporation Tax or Self-Assessment
Arrange for HMRC Investigation
You can contact HMRC with a request for an enquiry into your business and they will decide whether or not one is necessary. In order for HMRC to investigate your business, you will need to have a good reason for it.
For example if the amount you pay in tax each year doesn’t match up with how much income you earn and there is no other explanation for the difference, then this might be seen as suspicious.
Another way that HMRC may look at your financial records is if they suspect there are tax crimes being committed by employees of yours or even yourself!
Businesses should prepare for HMRC investigations
There are a few things you can do to prepare yourself in case of an HMRC investigation. First, make sure your records are in order and all the necessary information is available.
When we’re not preparing for an HMRC investigation, we’re ensuring that our clients are compliant with the law. Ensuring your business is compliant with HMR obligations is vital when it comes to investigations because it can lead to penalties if you don’t have everything in order.
We also recommend arranging for an HMRC investigation before one takes place as this will prevent any gaps or problems from arising when they come knocking on your door! If something does go wrong during an investigation then there’s nothing worse than trying to figure out how to fix it while being under pressure from the taxman!
Another thing businesses need to do before being investigated by HMRC is make sure they have appropriate insurance cover in place which covers them against any potential fines from HMRC if something goes wrong during their investigations (or indeed how much those fines might be).
We hope that these tips have been helpful in getting your business ready for HMRC Investigation Cover. If you have any questions, please feel free to contact an expert.
