Taking the stress from our clients

Taking the stress from our clients - Pocknells LLP

Dealing with a tax investigation

The situation: A small business owner had been completing her own accounts and Tax Returns.

HMRC identified discrepancies in her accounts and raised an enquiry with the owner. The owner came to us very stressed and worried as she had tried to resolve the enquiry with HMRC but it had not been concluded.

The solution:  After reviewing the year under enquiry, and the previous years, we noticed that her prior year’s accounts were also incorrect. She had recently registered for VAT and was overstating her income. Furthermore, she was providing for expenses that were not allowable and needed adjusting.

We amended the previous year’s accounts and Tax Returns and prepared an accurate set of accounts for the current year.

We then disclosed these accounts to HMRC and after providing all the supporting documentation, they accepted the amended accounts and were happy to conclude the investigation.

HMRC issued an assessment and charged penalties and interest on the outstanding amounts.  With further negotiation we requested that the penalties were suspended due to mitigating circumstances, and on the basis that our firm continued to manage the client’s taxation affairs.

The outcome:

The client paid the outstanding liabilities. She was most grateful to Pocknells for concluding matters for her as she was finding the whole process of an investigation very stressful.

She is now able to concentrate on running her business without the added burden of preparing her accounts and Tax Returns.