HMRC Investigation

shelleym Registered Posts: 31 Regular contributor ⭐
HI all I have had a prospective new client introduced to me he is a builder who works under CIS and his current situation is that for the past 6 years he has used an accountant who did not ask for receipts when compiling his tax return so at the end of each tax year he would provide the accountant with income received and cis tax deducted then the accountant would prepare the tax return (i presume using a percentage for expenses and submit it then the client would receive his rebate. HMRC are investigating this accountant and his clients and they have advised this client that all of the expenses claimed have been disallowed and they will only allow him to claim 10% of his earnings as expenditure which will result in him owing them £18000.00. My question is has anyone else been in this situation and if so do they have any advise on how we should proceed to reduce this figure. Many thanks in advance


  • tinkerbell0406
    tinkerbell0406 Registered Posts: 58
    Hi i had a sort of similar problem with a client. They wanted vat back for many years and he is part exempt. The answer to the question lies with proof....lots of it. Get old bank statements, recipes anything and prove this was business expense. They will reduce the total if you can prove this. It's a lot of hard work took me nearly three years ti get my client out of it and he still had ti pay a fair amount back.
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