There are, apparently, 50,000 businesses that have failed to submit VAT returns. That represents 1 in 12 of the total of 600,000 businesses which should submit a monthly VAT return to HMRC.
HMRC, not unreasonably, are a tad fed up and have issued a warning that if the recalcitrant companies do not submit a return and pay any outstandings by 28 February then HMRC will take a "closer look" at their tax affairs.
Jayne Simpson, Senior Indirect Tax Manager at Menzies accountants, is quoted by Director of Finance:
“There has always been the threat of penalty charges, interest and even criminal investigation for unpaid tax. But this announcement explicitly states that HMRC will take a much closer look at the tax affairs of those who do not pay what VAT they owe by 28 February.Bottom line, do not ignore correspondence/demands from HMRC!
The implication is that these businesses could be exposing themselves to the risk of a tax investigation, which can be very costly and disruptive. At that point once HMRC has a business under review, if further anomalies are found the penalties can only increase.
Because VAT can be so complex, businesses may be unaware that they owe anything. So if you have already received a demand from HMRC, do not ignore it. Even if you think you owe nothing, its best to straighten matters out with them.
They will not go away.”
Tax does have to be taxing.
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