HMRC Penalty Regime

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This week we have been dealing with an enquiry from HMRC into one of our clients. They did not advise us of a PAYE job that they had taken on in addition to their business and subsequently had additional tax and a penalty to pay.

There are a few lessons to learn from this.

1) Clients need to tell us about all their income in order for us to do their Self Assessment return correctly even if it has been taxed at source.

2) Even though HMRC were in possession of all the facts, the decision was made by them to open an enquiry and apply a penalty instead of just contacting us and asking us to correct the error. Clearly, in these straightened times revenue generation through a penalty regime is a welcome way of helping HMRC hit its targets.

Luckily the client in question is covered by our enquiry insurance so at least they can rest assured that we will deal with the enquiry free of charge to them while arguing their case in a forceful manner. We have also contacted our local MP to complain about the heavy-handed behaviour of HMRC.

John McLaughlin Chartered Accountant Scotland

John McLaughlin

Sutherland Black are plain talking accountants based in Scotland. We’ll support your business growth and goals. Talk to John today for friendly yet expert accounting advice.

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