Firm warns of penalties

IF you run a small business, the tax man could be hammering on your door shortly to check your records. If they are not up-to-scratch you could face a penalty of up to £3,000.

The warning comes from independent accountants and business advisers, Whiting and Partners of Wisbech, who say HM Revenue and Customs (HMRC) will shortly start a four-year programme of checking the financial records of these businesses that could raise £600m in penalties.

Chris Morton, of Whiting and Partners, said HMRC is convinced that poor record keeping is endemic among small businesses with 40 percent failing to keep proper records.

The programme starts in July and it is estimated that a potential £600m will be clawed back through penalties.

“There is already a statutory requirement for those in business to maintain and retain adequate records needed to make accurate Tax Returns.

“While the legislation to provide penalties for any failings has been in place for some years, these have, until now, only been used in the most serious of investigations. Clearly that will change for the future,” said Mr Morton.