A £158BN hole in the public finances means that HMRC are being used to try and raise extra cash for the Treasury, as quickly as possible and that will mean easy targets, so small and medium size firms, anyone in the construction industry are in the direct firing line for:

employer compliance reviews

PAYE/NIC investigations

Employment status reviews

tax investigations

you name it and they are heading your way and don’t think it won’t happen to you – it will, so why not take advantage of the special deal that EICG is running this month on PAYE/NIC healthchecks and Construction Industry reviews, call us today on 0800 917 9176 to see how we can help you avoid being a victim

HMRC announced in June that Extra Statuory Concession B46 (ESC B46) allowing a seven-day grace period for late employers’ and contractors’ returns will cease from 31 March 2011.

ESC B46 established the principle that penalties would not be charged when employers and contractors submitting tax returns and CIS forms had taken “all reasonable steps” to file their returns on time, but were not able to do so due to unforeseen circumstances such as postal delays.

With the advent of online filing, which is required for P35s and P14s and will become mandatory for Corporation Tax returns from 1 April, HMRC considers the concession to be “redundant” because the delays it was intended to address will no longer happen. Returns must therefore reach the department by their due date or incur a late filing penalty of £100.

Confirming the new penalty regime HMRC explained: “Any customers filing a return late will, as now, be able to request us to remove any penalty, if they believe they had a reasonable excuse for the delay in filing. We will consider every case on its own merits. Customers can also appeal against the penalty to a Tribunal.”

HMRC are now out and about big style as they have told their Inspectors to bring in as much money as possible, as quickly as possible, which is not really surprising given the current economic environment.  There will be pressure to settle long running full enquiry cases and Inspectors will be encouraged to take up aspect cases (these are as they sound, looking at a particular aspect of a business, eg employment status, entertaining expenditure etc ) which are likely to be settled more quickly to optimise the tax yield in the current fiscal year.

Interestingly, it would appear that the new “Cross Tax” enquiry framework, involving PAYE/NIC, Corporation Tax, VAT etc is being shelved as it is slowing up the enquiry process so Inspectors will be reverting to just working their particular area

Now we’ve all heard of how much money HMRC needs/should bring in with tax investigations, employment status reviews, PAYE investigations etc and as soon as possible you would think. Well, this morning was a relevation, in an attempt to speed up an enquiry I had agreed with the investigating officer that it would be a good idea to have a meeting, at our offices to go through the information they required, no problem until this morning. The very apologetic investigating officer explained that they had been told that due to all the cutbacks they were unable to travel for a meeting and would have to deal with the enquiry via correspondence and telephone. After checking it wasn’t 1st of April I said that this made no sense as this would prolong the enquiry because of HMRC backlogs etc to which to be fair the officer completely agreed, so what is going on – is this just a daft local decision or something more widespread?

HMRC you need to wake up and use some common sense – meetings can speed up the whole process – you are investigating someone or some entity, so they shouldn’t have to pick up the cost – you should be prepared to travel and guess what if there is a settlement to be made the money will be in the coffers quicker and the officers involved will be free to move onto another case – simples!