Stay OUT of Hot Water, SAVE Yourself £3000 and a whole lot of Hassle!!Posted by Tracy Baker on Jun 10, 2011 in Blog, Finance | 2 comments
HMRC has given its final warning to small businesses in the UK by creating its Business Records Check Programme this could see fines of up to £3000 for those not “in the know”.
This is the first time the taxman has been interested in checking out your current year’s records, up until now they have been satisfied with chasing you once you have filed an inaccurate return or paid too little tax… nice.
So what does this mean for business owners in the UK and how can you make sure that you comply with the Business Records Check Programme so that, should you be one of the chosen few for a spot check, you can rest in the knowledge you have done all that is expected?
In December 2010 HMRC had an initial consultation in their attempt to tackle bad record keeping and specifically small traders “significant failures”. It now seems that although HMRC had indicated that they would not start carrying out these spot checks until the autumn of this year, they have already issued 1000 businesses with letters, indicating that they are making an early start.
Business owners should take these warning very seriously – if you do not keep accurate book keeping records with substantiated paperwork (digital or otherwise) and are unable to back up the figures you have entered onto your tax returns you are very likely to; at best end up paying extra tax and at worst find yourself landed with a hefty fine to boot.
Fortunately it would seem HMRC have pre-empted this Programme with some free guidance tools to assist the small business owners and entrepreneurs in ensuring they step up to the mark.
Whilst it may seem a challenge or a drain on your precious time when you’re starting out, keeping good records with accurate book keeping brings very real advantages to your business. By getting a proper system in place you will not only be confident that you are paying the correct amount of tax but you will also have an accurate and vitally important snapshot of how your business is performing, what areas can be improved, what is working well or not as the case may be.
If all of this seems far too much like hard work or doesn’t fill you with a sudden rush of enthusiasm (it doesn’t?? surely not!!) then you could, of course always outsource all of this to a Virtual Assistant or Virtual Assistant Company who specialise in Book keeping, freeing up your time to concentrate on growing your business, after all that was why you started your business in the first place right?
What Do You Find is the MOST frustrating task for you as a Business Owner or Entrepreneur?