VAT Inspection & Investigation

The recent HMRC crackdown has resulted in more VAT inspections than ever. The UK government is doubling down on efforts to ensure that every business complies correctly with tax and VAT legislation. Of course, being under any form of taxation investigation can result in a great deal of stress. However, having full evidence to hand and a team of expert VAT inspection solicitors on your side will make everything far easier.

How Can DBT & Partners Help?

The specialist VAT inspection solicitors at DBT & Partners have years of experience in handling HMRC dispute cases and inspection outcomes. Whether you’re facing a VAT inspection, disputing an assessment or are in any way concerned about another HMRC-related matter, we can assist you by helping you to gather evidence to support your case, attend hearings or interviews with you and work to ensure that the outcome of any dispute or investigation is fair and correct in accordance with the information you have given. Read on for a little VAT investigation advice from our specialists that will help you to understand the situation a little better and decide whether you require the services of our experts.

Matters Related to VAT Inspection and Investigation

If you or your company is found not to have complied correctly with VAT guidelines, you may be prosecuted for:

• VAT, Invoice and Payment Fraud
• Tax fraud
• Excise or Diversion fraud
• Contravention of customs law
• Cheating the public revenue

VAT inspection penalties can be very severe – plus, your company and those you employ will be at risk if the outcomes of any investigation are negative – so getting in touch with trusted VAT inspection solicitors at as early a stage as possible may be vital.

VAT Inspection Tips

In order to ensure that any enquiries that are launched into your company’s compliance with taxation law are as easy and painless as possible, below are a few elements of VAT investigation advice:

VAT Inspection Visits

Usually, only one officer will attend on the day of a HMRC visit, though there may be two if your company is large or complex.

It’s important that when you meet with the inspectors, you are able to provide them with:

• Your company’s VAT certificate
• Your company’s certificate of registration
• Your company’s annual accounts
• Records of any VAT you have paid and claimed throughout the tax year
• Any other detailed accounts including petty cash and sales registers
• Invoices for both sales and purchases
• Company bank statements
• Any other supporting documentation

As the owner of the business, you’ll need to be present when any HMRC officers are in attendance. You don’t have to stay with them for the entire time, but they will need to be able to ask you any questions as and when it is required. Anyone else who deals with your company’s accounts should also be there for this purpose.

The officer in attendance has the right to take copies of any documents they require in order to study them further at their office. If they have inspected certain documents before, they are allowed to pick them up again without you having to hand them over, but if they are inspecting something for the first time, you’ll need to hand it to them.

Remember: If the HMRC officer wishes to take original documents, ensure you get a full and detailed receipt of everything that has been removed.

If you have any questions about anything the officer undertaking the inspection is doing throughout their visit, you can call your solicitors for advice.

Vat Inspections: Frequently Asked Questions

What triggers a VAT inspection?

If your company has been made the subject if a VAT inspection or investigation, this may be because:

• The industry in which you operate is being targeted by HMRC as a ‘high risk’ sector
• HMRC wishes to verify who your suppliers are
• HMRC wishes to verify who your customers are
• Your tax returns have failed a HMRC credibility check
• HMRC have been made aware of information regarding your business
• Your and/or your business has a history of non-compliance with VAT legislation

However, HMRC also undertake routine checks, so it’s likely that there is nothing to worry about at all.

How long does a VAT inspection take?

HMRC VAT inspection preparation and process guidelines usually encourage officers to provide you with 7 days’ notice before an on-site VAT inspection takes place – however, it’s possible for them to turn up without notice. You will also be able to request that the visit is delayed if necessary. An inspection usually takes around two hours, though this depends on the size and complexity of your company.

What happens after a VAT inspection?

After the VAT inspection, you will receive a letter detailing any concerns that HMRC has with your business, including any VAT you owe. You may also be issued with a penalty. If the letter contains anything you don’t understand, or if you disagree with any of the information stated or the VAT inspection penalties you are being charged, please don’t hesitate to contact DBT & Partners.

If you receive notice of any VAT inspection penalties, you can either pay the amount that HMRC say is overdue or over-claimed, or dispute the assessment. If you choose the latter, you will need to ask for a review, which may result in a Tribunal Appeal. HMRC compliance check time limits state that you will have 30 days to appeal any decision.

For further VAT inspection tips, or to hear more about what our expert VAT inspection solicitors can do to assist you, simply get in touch with DBT & Partners today.