HMRC Extends Crackdown on Poor Record-keepers
Small bsuinesses should check their books are in order — that’s the warning from HM Revenue & Customs (HMRC) after it announced it is extending the crackdown on poor record-keeping nationwide.
HMRC’s Business Record Checks programme was piloted in eight cities across the UK earlier this year — from which the tax body has discovered that 44 per cent of businesses had issues with their records and 12 per cent had seriously inadequate ones.
An additional 12,000 business record checks are now due to be carried out before the end of the year, before the programme is rolled out nationwide in 2012. Small businesses not keeping tax records up to date risk paying a penalty of up to £3,000.
“Good record-keeping helps businesses pay the right amount of tax at the right time, thereby potentially avoiding interest and penalties,”
said HMRC director of local compliance Richard Summersgill.
“Adequate records give businesses a clear idea of their trading position and profitability, allowing them to make business decisions and adjustments to ensure survival and success.”
Earlier in the year HMRC launched four new products to help the self-employed and small businesses keep better records:
- a factsheet on how to keep records (PDF)
- a guide to keeping records for tax returns, including common problems and examples for different types of business (PDF)
- a guide to setting up a basic record-keeping system, with examples of spreadsheets
- and an interactive checklist that tells businesses how well they are keeping records and how to improve them.
Whatever records you keep, it makes sense to organise and keep them in an orderly fashion. This will help you and your accountant (if you have one) as well as HM Revenue & Customs (HMRC), if they need to ask you anything. For further business advice read HMRC’s guidance on record-keeping