TaxCorporate TaxHMRC accused of heavy-handing SMEs

HMRC accused of heavy-handing SMEs

Tax officers threaten traders with fines if their books are not in order, despite assurances no fines would be issued during the pilot period

THE TAXMAN has been accused of heavy handing SMEs during a pilot scheme to clamp down on poor financial record keeping.

In March, HMRC started a pilot scheme investigating the books of trading businesses. It claimed its Business Records Checks final scheme would tackle 50,000 of the worst offenders issuing fines of up to £3,000, The Daily Telegraph reports.

The taxman said it would not issue any fines during the pilot period.

However, according to Baker Tilly, accountants had heard of HMRC officers informing small business owners that they would be fined if “anything was found to be wrong”.

“If HMRC is genuinely looking to improve the standard of record keeping, rather than investigating traders by the back door, then the department must make sure it plays by the rules,” Mike Down, head of tax risk and investigation at Baker Tilly said.

A spokesman for HMRC said: “We are not seeking to apply the penalty provision during [the pilot] other than in exceptionally serious cases. In [most cases] the approach will be to assist in improving the business records, where there is a need.”

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