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HMRC taking more tax from large firms

HMRC’s VAT avoidance investigations have led to a record-breaking additional tax take in the last 12 months, according to research carried out by legal company Pinsent Masons.

The analysis comes after HMRC looked, in detail, into avoidance among the country’s largest businesses.

Situations like these occur from red flags on a company’s numbers which, whether intentional or not, can cause the HMRC to sit up and take notice, creating problems for other businesses.

This is why it is vital that accountants in Eastham and across the UK are keeping accurate records of their clients’ books.

According to Pinsent Masons, the HMRC Large Business Service’s investigations into the VAT agreements of the country’s 770 largest companies led to an additional £1.44 billion being taken for 2012/3. This represents an 18 per cent rise from the £1.23 billion yielded a year earlier, and is over three times the £443 million take recorded in 2009/10.

Darren Mellor-Clark, a partner of Pinsent Masons, said that in the last 12 months, HMRC has been working hard to crack down on companies which it sees as “unhelpful” when looking into their VAT arrangements. He went on to explain that depending on severity, businesses’ tax bills can double once the appropriate fines have been applied.

The company also warns of a tougher stance on ‘missing trader’ or ‘carousel’ VAT fraud. It feels that HMRC is stopping legitimate firms in the chain from claiming back VAT payments in the trades, by leaving them with little choice but to check up on businesses they trade with to ensure that they are not engaged in fraudulent activity.

Posted by Louise
October 23, 2013

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