ARTICLE · 28 JUNE 2011

Business Record Checks

Smith & Williamson

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HMRC plans to check the business records of 50,000 SMEs a year for four years, imposing penalties on businesses whose records do not conform to their high expectations.

United KingdomTax

Richard Mannion

HMRC plans to check the business records of 50,000 SMEs a year for four years, imposing penalties on businesses whose records do not conform to their high expectations.

HMRC is introducing a programme of business record checks (BRCs) that will review both the adequacy and accuracy of business records within the small and medium enterprise (SME) sector.

HMRC says that its random enquiry programme indicates that poor record keeping is a problem in around 40% of all of SME cases which could lead to a loss of tax in two million SME cases annually. It is therefore planning to use its powers to check business records in up to 50,000 cases annually, starting in 2011. There will be penalties for significant record keeping failures and the aim is to bring about an improvement in record keeping across the SME population.

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