Date posted: 12th Oct 2020
During the initial stages of the COVID-19 pandemic, HM Revenue & Customs (HMRC) re-assigned staff members to make sure that there was sufficient human resource to allow businesses to claim the grants that the government had made available.
It is anticipated by the accountancy profession that HMRC would wish to re-coup as much of that outlay as possible – either via future tax rises or by closing the perceived “tax gap” which is the government’s estimate between the amount of tax that should have been paid in a year and the amount of tax that was paid in the year.
We are anticipating that there will be future tax increases, across all taxes. However, we are also anticipating (and seeing) a number of tax enquiries being opened by HMRC as they attempt to recoup monies granted to businesses during the pandemic.
At the start of the pandemic, ongoing tax investigations and enquiries were largely mothballed whilst staff resource was limited, but the activity on these matters is now beginning to reignite and HMRC have already stated that they will be seeking to recover monies incorrectly claimed via the furlough grants schemes.
As current clients will be aware, our tax investigation service offers protection against our costs of dealing with HMRC enquiries, which can run into many thousands of pounds, depending upon the length of the enquiry. It may be a wise move to consider taking up the service sooner rather than later, if you have not already done so.
Should you have any queries on the above or need further support, please contact our tax team here, who will be happy to assist.
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