Jump to content
House Price Crash Forum

Archived

This topic is now archived and is closed to further replies.

man o' the year

VAT Inspection

Recommended Posts

I would be grateful for advice regarding our first VAT inspection from any one who has already gone through the process. Although not on the fiddle this will prove to be difficult as I do the returns and am 180 miles away looking after my parents. This fact has led to our turnover taking a steep down turn during this time (14 months) as my wife tries to cope and this together with me being one day late this quarter making payment as my Mum had DVT and was hospitalised  may be the trigger for the inspection.

We have so far only had a call to say that they will ring back to tell us when they are coming. I am interested in answers to :

1) How much notice will they give

2) How many years will they likely go back.

3) Any further pointers as to how to make the process as painless as possible

I also pay an insurance fee to have my accountant work any extra hours the inspection may necessitate but life being life tried to contact him today with the news to find that he is abroad on holiday.

Is it worth trying for a postponement do you think? Any advice gratefully received.

We are unlikely to have all necessary paperwork - receipts etc. I realise I have been lapse because of present circumstances. Some of these I could certainly retrieved but others maybe not as we have fallen out with some suppliers. I suppose that may mean we may be appealing any punitive decision.

Feels pretty scary at the moment despite my overview records showing us as having over paid by £816.

Share this post


Link to post
Share on other sites
21 minutes ago, man o' the year said:

I would be grateful for advice regarding our first VAT inspection from any one who has already gone through the process. Although not on the fiddle this will prove to be difficult as I do the returns and am 180 miles away looking after my parents. This fact has led to our turnover taking a steep down turn during this time (14 months) as my wife tries to cope and this together with me being one day late this quarter making payment as my Mum had DVT and was hospitalised  may be the trigger for the inspection.

We have so far only had a call to say that they will ring back to tell us when they are coming. I am interested in answers to :

1) How much notice will they give

2) How many years will they likely go back.

3) Any further pointers as to how to make the process as painless as possible

I also pay an insurance fee to have my accountant work any extra hours the inspection may necessitate but life being life tried to contact him today with the news to find that he is abroad on holiday.

Is it worth trying for a postponement do you think? Any advice gratefully received.

We are unlikely to have all necessary paperwork - receipts etc. I realise I have been lapse because of present circumstances. Some of these I could certainly retrieved but others maybe not as we have fallen out with some suppliers. I suppose that may mean we may be appealing any punitive decision.

Feels pretty scary at the moment despite my overview records showing us as having over paid by £816.

Been audited but not for vat. Wasn't as scary as i thought and just let the accountant deal with it. Who keeps copies of the books, if it's the accountant then get them to delegate it to an employee.

 

Have you missed any deadlines lately?

For VAT its an excise issue i think, and unless you've been committing carousel fraud it doesn't sound like it's worth losing sleep over. Any penalties can be paid later.

Share this post


Link to post
Share on other sites

When I was starting out as an accountant I had one VAT inspection. It was over 10 years ago but I remember a lot of the things he was looking for were statistical anomalies (changes in turnover, vat as a percentage of turnover etc). I seem to remember the issue was one of the newly EU A8 countries wasn't being charged VAT on the sales invoices. Didn't actually effect the VAT due amount but meant that both the boxes for VAT payable and receivable were wrong by the same amount and (in particular) the net sales figure didn't tally with the VAT payable figure. 

He was there a few hours but was satisfied with the mistake as no extra VAT was due. 

He was quite meticulous and checked a fair few invoices and my workings for several VAT quarters. 

Cant remember how many years they can back (something is telling me 6). 

 

Good luck with it. As stated, as long as you're not commiting carousel fraud you should be fine. Not having VAT receipts for VAT claimed may be a problem. 

Share this post


Link to post
Share on other sites

Not been inspected for VAT or tax. Was told it was awful by the accountant selling me 'Vat inspection insurance'.. but am with a different accountant now. 

If you've done everything to the best of your ability then that's all you can do. 

I am sure you can wait until your accountant is back in the country. Unless he's flown one way.

 

Share this post


Link to post
Share on other sites

I assume it will be relatively painless. Unless you have reason to believe otherwise, I don't think it's supposed to be a "surprise" visit, so if you ring and explain your circumstances, you should be able to arrange a more convenient time.

They are not trying to catch you out, they just want to check you know what your doing. If they find any mistakes, you will have to pay, probably with interest. 

That said, your experience may be different as a small business. And it's been awhile. They're probably on a percentage of what they recover from you these days. 

Share this post


Link to post
Share on other sites

I had one VAT inspection and it all went smoothly. Went through my company accounts for 3 years.

If you explain that you are away and the circumstances and ask for a postponement they may go away and forget all about it. That happened to me on another promised VAT inspection on a different company. Just don't make a big deal of it.

 

Share this post


Link to post
Share on other sites

About time filling in vat returns ought to have been automated away and no vat is charged or reclaimed on B2B sales and is a straight 20% on sales which with any cash or chequeless business could be taken straight off point of sale proceeds.

Like with all things, of this nature H&S inspections etc, I seem to recall they like to find something, so worth setting up an easy win. Also worth remembering that they'll often be no less lazy than other people. If you appear eccentric, chaotic and lacking in visible wealth, there's a good chance if they aren't seemingly going to raise more than a couple of grand they'll move on to someone else. I also seem to recall if you can't find bits of paperwork they leave a list to forward. When I had one years ago I think I found some big invoice I'd forgotten to claim whilst leafing through piles of invoices looking for the much smaller one they'd requested and after that things were quickly drawn to a conclusion.

 

Share this post


Link to post
Share on other sites

Are you a director of a limited company and is that the capacity they're checking it under? The alternative if you really don't want to do it would be to start the striking off procedure now. It isn't guaranteed to work but just food for thought, depending on your situation. 

 

You'd think this would set off alarm bells but it seems to work for corporation tax avoidance eg phoenixing.

Share this post


Link to post
Share on other sites

Yes - limited company. Nothing to hide but likely loads of missing pieces of paperwork partly due to my enforced absence for last 14 months and partly due to flood 3 odd years ago. There is a paper trail for big purchases as these are inevitably made through business bank account. All depends how strict they are.

Share this post


Link to post
Share on other sites

I only had one, about twenty years ago. It was fairly painless, the only problem was when he asked for the purchase invoice files between specified dates, which I gave him. He couldn't find a particular invoice and I said it was in an earlier file.... "are you saying there's another file? I need to see that". He then spent over an hour going through it with a fine tooth comb. He could have saved himself the bother if he'd asked for it in the first place.

When he left, I asked when I would see him again, the reply was.... "Not for yonks, if at all".

 

Share this post


Link to post
Share on other sites
5 hours ago, man o' the year said:

Have been in touch today. - pencilled in for 2nd March but wants phone contact before then. Looking for 4 years of accounts.

Suggest you line up your accountant to deal with this for you (you've paid insurance after all) -if he's unavailable I'd ask the Inspector to reschedule on the basis that you have a professional adviser ("as you're keen to pay the right amount of VAT and keep the paperwork in order") and you'd like him to be available to make the visit as efficient as possible for the inspector.

Share this post


Link to post
Share on other sites

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   28 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.