TaxAdministrationRevenue letter causes small business panic

Revenue letter causes small business panic

An attempt by the Inland Revenue to help small businesses avoid making mistakes on their tax returns has resulted in accusations of the body using 'scare tactics' and threatening taxpayers with investigations.

Link: Advice in short supply for SMEs

Despite opposition from advisors, the Revenue decided to send out the letters to small businesses that may have made mistakes in their last returns. But the tone of the letter led may to believe they were about to be investigated by the body, according to The Daily Telegraph.

The letter read: ‘From a risk review of 2003 returns we have identified an aspect of the self-employment pages of your return which may need particular attention. We want to help you get this aspect right first time which may avoid the need for an inquiry and I am therefore enclosing some “questions and answers” which aim to help you with that part of the return.’

The Federation of Small Businesses claimed that the letter has caused an enormous amount of problems and created ‘unnecessary tensions’ between companies and their advisers.

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