If you haven’t filed your tax return yet, the January 31st deadline is looming! Last year more than 700,000 people failed to submit their tax return before the deadline. But it’s important to make sure the information you submit is not just on time but accurate! According to data released in 2019 for the tax year 16/17, HMRC opened over 300,000 investigations into self assessment tax returns. Not only that but the tax authority collected a staggering £1.2bn in extra tax from investigations into tax returns in 2018/19!
Avoid tax return mistakes
Tax payers need to be vigilant when filing their own tax return to avoid making a mistake. Although mistakes may not be deliberate they can raise suspicion leading to investigation by HMRC and potential penalties. In 2018/19 HMRC imposed over 31,500 penalties for deliberate behaviour. The penalty for which, can be as much as 100% of the amount of tax in question. Failure to take reasonable care can be up to 30%.
Tax investigations can cause a lot of stress and can drag on for months, and in lots of cases, years, which can have a knock on effect on your business. HMRC is becoming more advanced than ever in the way that they collect tax. Did you know that they even scan social media accounts of tax payers during investigation to gather evidence!
If there are unusual increases or decreases in your income make sure you explain them to HMRC when you submit your return. This may decrease the likelihood of them opening an investigation.
Alternatively, seek professional help. We can ensure that your tax return is completed correctly and on time. We also offer Tax Investigation insurance which means that should you be investigated we will be able to help you. Our fees will be covered and you could save potentially thousands of pounds!
If you would like more information or if we can help in any way give us a call on 01332 292022. Or drop us an e-mail