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Dedicated to the taxpayers of Britain, and the employees of Her Majesty's Revenue and Customs (HMRC), who have to endure the monumental shambles that is HMRC.
Thursday, 1 October 2009
UHY Hacker Young warn that new businesses are facing a struggle establishing themselves as a result of delays, of between three and five months, waiting for VAT numbers.
The theoretical timeframe for HMRC to complete most VAT registrations is two weeks.
UHY Hacker Young state that the delays are due to administrative backlogs, as HMRC carries out anti-fraud checks and inefficiencies in processing applications.
HMRC claims that over 70% of VAT registrations are processed in two weeks. However, UHY Hacker Young retort that this discrepancy is because HMRC only counts the time it takes to complete the actual administration, after it has received all the requested information. HMRC ignores the several months of checking and investigation beforehand, which forms part of the anti-fraud process.
Simon Newark, VAT Partner at the accountancy group, comments:
"The backlog at HMRC has never been worse, despite assurances over the last few years that the issue was being resolved. These delays are causing serious problems for small businesses trying to start up in a tough business environment and are hampering wider economic recovery.
Fraud will always be an issue, particularly during a recession, but if HMRC's own poor management and inefficiencies are to blame for delays, why should taxpayers bear the cost?
HMRC needs to streamline its processes and get a grip on its staffing issues as a matter of urgency.
The HMRC staff conducting the fraud checks routinely disregard information contained with the applications and demand the same documents, which are often completely irrelevant, again and again.
When I made a formal complaint I was told that because all taxpayers were being equally disadvantaged, no individual taxpayer had grounds to complain that he was being unfairly treated!"
Well now, if that is the attitude of HMRC (wrt individuals not mattering) maybe the firms who have suffered because of HMRC's delays should mount a class action; on the grounds that the entire group is being unfairly treated?
Tax does have to be taxing.
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