VAT inspection!
Discussion
Just had a call from HMRC saying they ae conducting a 'routine inspection' in May (they wanted April but the records are with my accountant for my accounts to be drawn up). Are routine inspections really routine?
Should I worry?
I run a petty neat ship and there is no deliberate or even 'tongue-in-cheek' scullduggery. I am not an accountant, but I do keep fairly metioculous records of every penny spent and earned (all central govt contracts with one or two minor exceptions and always paid by cheque or BACS) and have simple Excel systems to capture the VAT.
I can't pretend to understand things like scale charges and a few years ago my accountant did find an underpayment (due to an error in my spread sheet) which I corrected immediately and repaid. For the past few years my accountant has felt the VAT man owed me money but due to complications in the end of year dates struggled to quantify it exactly.
Should I worry?
If you've kept your house in order its pretty straightforward. I had an inspection a couple of years ago. my stuff was all on Sage, they had a basic query about business I did in the Middle East but other than that it was very straight forward. If you know you are pretty much there or there abouts each quarter then I think you can relax, if you haven't then obviously its squeaky bum time.
Had one three weeks ago.
These people are mostly not ogres and are not out to get you, unless you are deliberately hiding things.
Just be pleasant and answer any questions that they may raise.
If your accountants help you with the books, or prepare the VAT returns, ask them to be present to answer any questions on your behalf.
The Inspector should be perfectly happy with this.
- just chill
These people are mostly not ogres and are not out to get you, unless you are deliberately hiding things.
Just be pleasant and answer any questions that they may raise.
If your accountants help you with the books, or prepare the VAT returns, ask them to be present to answer any questions on your behalf.
The Inspector should be perfectly happy with this.
- just chill
PetrolTed said:
I had one a few weeks back.
They ask what software you use and then when they turned up they told me that they weren't actually allowed to touch my PC.
So every query they brought up I had to dig out paperwork for. Bit of a pain, but nothing much came of it in the end.
I thought about that actually, dropping it into a single file format (it has changed year on year)and printing out my monthly sheets. I presume they bring their own lap tops.
I had a customs inspection last year - vat with bells on (importing etc)!
Very friendly but very thorough. They're not paid a bonus or by the hour, just to go an spend x hours (in my case 5) and see if they find something. Bit like a prostate examination
>> Edited by aceparts_com on Wednesday 12th April 12:39
Very friendly but very thorough. They're not paid a bonus or by the hour, just to go an spend x hours (in my case 5) and see if they find something. Bit like a prostate examination
>> Edited by aceparts_com on Wednesday 12th April 12:39
leftie said:
I thought about that actually, dropping it into a single file format (it has changed year on year)and printing out my monthly sheets. I presume they bring their own lap tops.
They don't bring any computers with them.
Paper summaries proved very useful. Had I not done summaries of my VAT returns they'd have had to work a lot harder or be a lot more random about what they looked at.
Davel said:
If your accountants help you with the books, or prepare the VAT returns, ask them to be present to answer any questions on your behalf.
The Inspector should be perfectly happy with this.
If your accountant prepares your vat returns you should ask to have the inspector visit their office to review the records there, which means even less hassle for you.
PetrolTed said:That's the one thing that worries me about an inspection. I know I'm squeeky clean and never sail close to the wind, but I'm not a very organised person, my desk is a mess, and my filing is not up to date. Receipts and paperwprk could be literally anywhere.
So every query they brought up I had to dig out paperwork for. Bit of a pain, but nothing much came of it in the end.
(Yes, I know, I know)
JonRB said:
So every query they brought up I had to dig out paperwork for. Bit of a pain, but nothing much came of it in the end.
(Yes, I know, I know)
.. me too.JonRB said:
So every query they brought up I had to dig out paperwork for. Bit of a pain, but nothing much came of it in the end.
(Yes, I know, I know)
If they are not satisfied with your paperwork presentation, eg you've lost bits or it just doesn't make sense they will retreat, give you a warning and a set time to get everything into order and then come back to do it again.
vixpy1 said:
So every query they brought up I had to dig out paperwork for. Bit of a pain, but nothing much came of it in the end.
(Yes, I know, I know)
I haver a system of keeping a monthly envelope where all receipts for that month go which gets sealed at the end of each month. Very occasionally a document will be in the envelope from the month before ior after, but it works well and I only have this months paper around me.
We had one a couple of years ago. I must say I was crapping myself but in the end the chap was really decent. There were a few things they pulled us up on, but then there were a few things we were missing out on. His view was that they probably balanced out and so he would not take any action as long as we stopped doing the wrong thing (taking the chaps out for a curry every few months and claiming the vat back) and started doing the right things (such as being able to claim 5ppm per extra employee in the car on a trip and such like).
Then we had a nice cup of tea and he regaled me with horror stories of people who had tried to pull a fast one...
All in all a good day
D
Then we had a nice cup of tea and he regaled me with horror stories of people who had tried to pull a fast one...
All in all a good day
D
My girlfriend is a Customs and revenue officer. 90% of her time is spent visiting traders. It is random and routine and you have nothing to be alarmed about. Its when they kick your door down with the police present that you should start worrying.
PS just spoken with her she said that actually there usually is a reason for a visit!!! so get read of any eveidence pronto. Good luck
>> Edited by jamesuk28 on Thursday 13th April 16:23
PS just spoken with her she said that actually there usually is a reason for a visit!!! so get read of any eveidence pronto. Good luck
>> Edited by jamesuk28 on Thursday 13th April 16:23
Just getting papers ready for the big day.
I have noticed that when I had my own car for business use and claimed mileage that I never claimed any VAT back on the mileage. Should I have done?
I have printed out each monthly expenditure sheet from when I started in 2001 (my god I kept crap accounts in those days) through incorporation in 2002, which shows the VAT and VAT total paid each month, and the list of invoices with the date they were paid and the VAT quarter accounted in (I have an annoying habit of paying the VAT as soon as the form arrives so any paymnets in the last 2 weeks of each quater get accounted for in the followuing quarter) so did this to help my accountant. Except for this, and 4 big boxes of receipts, with envelopes for each month and paper copies of invoices, what else should I get ready? Would it be useful to have copies of my required accounts? Will they have copies of my VAT returns?
I don't want to do unnecessary work but then don't want to spend my day hunting down bits they may ask for.
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