Written by: Keith Tully
Reviewed: Friday 7th April, 2017
Efforts to limit and reduce the scale of VAT underpayments among SMEs throughout the UK netted HM Revenue & Customs (HMRC) an extra £3.3 billion in revenues during the past 12 months.
That’s according to the tax investigation insurance firm PfP, which has said that HMRC has quite deliberately been sharpening its focus on the issue over the course of recent months.
PfP says that two newly-created teams within HMRC, namely the Individual & Small Business Compliance Unit and the Wealthy & Mid-sized Business Compliance Unit, have had a major role place in boosting the amount of money gathered as VAT payments from SMEs.
The apparent success of efforts aimed at increasing HMRC’s takings from SMEs is expected to encourage the tax-gathering body to continue dedicating resources to its VAT-related lines of inquiry going forward.
“VAT investigations into SMEs have proven incredibly rewarding for HMRC,” notes PfP’s managing director Kevin Igoe.
“Whilst the vast majority of SMEs are compliant, the actions of a rogue few mean that HMRC is likely to look closely at the tax affairs of all over the coming months.
“Many innocent business owners are likely to find themselves under close scrutiny as the Revenue looks to weed out any remaining underpayment.”
Mr Igoe added that tax investigations can be “lengthy, costly and incredibly disruptive to businesses”, particularly those of a smaller size who are likely to find it very difficult to commit resources to resolving any associated issues.
He further explained that the process of identifying instances of VAT underpayment has been made considerably more straightforward in recent years thanks to a cross-referencing database system that’s now being routinely deployed by HMRC in this context.
A great many SMEs throughout the UK have found themselves with fresh cause for financial concern from another source in recent months, with the government having overhauled the business rates system for the first time since 2010.
The new business rates regime is expected to result in a notable rise in overheads for many thousands of SMEs across the country and for many it could be enough to threaten their financial viability and force them out of business altogether.
16th September 2019
There was around a 25 per cent increase in the number of restaurant businesses entering insolvency over the course of the year to June 2019, according to the latest figures on the subject.Read More