Against Inland Revenue / PAYE / P11D / Contributions Agency Investigations and VAT Disputes
Self Assessment has been in force for eight years and never has this type of business insurance taken such high priority. Self Assessment has led to a marked increase in HMRC full and random enquiries resulting in increased professional costs to protect your position.
Future full and random enquiries could well be computer generated and, therefore, may not take into account the unique trading environment of a business at a particular moment in time. It follows, even more so, that the vast majority of these enquiries will continue to have nothing whatsoever to do with fraud or negligence, minor year on year fluctuations in results could be enough to trigger off a full enquiry.
An average HMRC enquiry will last around 12 months and cost some £2,000 in professional fees to complete, probably twice that where the affairs are more complex. Costs often bear no relation to the final tax settlement.
Most of our clients need to be aware that VAT disputes are more often conceded because without fee indemnity cover fees can exceed any potential VAT saving. We also believe that PAYE/P11D and Contributions Agency Inspectors have achieved favourable settlements for the Exchequer because the economics of the situation and not necessarily the strength of the argument!
We have recently concluded a 3 year HMRC investigation into one of our small Limited Company retail clients.
This was a family business with a turnover of £150,000.
The HMRC assessed the company / directors for additional tax, interest and penalties of more than £200,000.
We took the case to the General Commissioners of the Inland Revenue and settled the enquiry for £5,000.
Fortunately this client was insured with IRPC and therefore all the costs of the enquiry were covered by Insurance.
Our costs for defending this enquiry were approximately £10,000. IRPC provided an expert in tax enquiries, the cost of whom would have been in excess of £10,000.
This type of aggressive enquiry is rare but when it does occur the results can be devastating.
Many of our clients have already taken out this Insurance and if you have not yet so we would strongly advise you to consider your position and ask us for a quotation. We cannot emphasise enough the real threat these enquiries can pose to your business.
Cunninghams are often asked for advice and guidance on non-financial matters and this has influenced our decision to choose the IRPC Scheme. As part of the service you will access to advice on:
- Employement and Personnel
- Health and Safety
- Commercial Legal Advice
You will not be charged any additional fees to the telephone advice from IRPC's specialists and we would encourage you to use this facility to your best advantage. Legislation in the areas is increasing and non-compliance can cost a business dear.
Please contact us if you require any further information or you require a competitive quotation for your business.
Require more information?
If you would like more information or would like to speak to us direct then call us on 01502 562326. Or if you would prefer, ask us a question online.