HMRC fines/interest if they disagree with your accounts

[Old Greg]

I know you're asking in more general terms, but seeing as you're talking about expense claims, i.e. your out of pocket business expenses that YourCo reimburses to you, then this wouldn't be something that would come up in an enquiry into YourCo's corporation tax return and accounts IMO.

It would either come up in a personal tax enquiry (if you've been claiming expenses that aren't tax deductible) or an employer records check (if YourCo has been paying expenses and not reporting them on your P11D or treating them as earnings and paying the right levels of tax via PAYE and employer NIC, if any).

Edited

“The triggers of an IR35 review can be either direct, because a contractor meets HMRC’s IR35 risk criteria, or indirect, as a result of another investigation, such as into corporation tax, VAT or payroll,” explains Qdos Consulting’s IR35 expert Andy Vessey.

[TheCyclingProgrammer]

I wasn't talking about an IR35 enquiry.

[Old Greg]

I wasn't talking about an IR35 enquiry.

I was.

[WordIsBond]

I see no-one has yet given an opinion on what they'd do if they were in the same situation.

posted at 20:55

I'd pay it back. Yesterday.

posted at 15:39

[WordIsBond]

I wasn't talking about an IR35 enquiry.

Some of us were.

And strangely enough, it wasn't long after we started talking about it before PC says he is going to pay this money back. Because he really doesn't want to trigger an IR35 investigation, does he?

I agree with him on this, though -- the legislation is crap. But it's what we have to live with as long as we keep electing idiots.

[Pondlife]

Umm I dont think that is going to happen. They are hardly going to go to my accountant and ask them, are they? I assume some sort of client privelege exists there for a start....

They are accountants, not solicitors. And surely if you're sitting down with HMRC and your legal representatives you'd also want someone in the room who has access to your companies accounts? Or would you be planning on explaining that bit yourself?

Following advice though, I may well pay it back. Its slightly less that I first thought to be honest and I really can't be arsed to have the argument with HMRC if it comes to that. If it'd been a massive amount I might have risked but its looking like a couple of days billing now so not worth it possibly.

Why, what's changed? FTAOD, I'm not saying you were clearly wrong. My point was that you were going against the advice from your accountant.

[Darren at Fox-Bartfield]

Article

Maybe of interest......posted on the smallbusiness.co.uk site

Link

[northernladuk]

So what's the current situation in all this? PC has been advised by his accountant to pay it back, forum has said the same but instead he's looking at the ramifications of getting caught to see if it's worth him keeping it?

Also did we find out exactly what his hit is for all this risk? I saw 2K but this won't be 2k from his pocket ultimately will it? Do we know the exact cost to him?

[Old Greg]

So what's the current situation in all this? PC has been advised by his accountant to pay it back, forum has said the same but instead he's looking at the ramifications of getting caught to see if it's worth him keeping it?

Also did we find out exactly what his hit is for all this risk? I saw 2K but this won't be 2k from his pocket ultimately will it? Do we know the exact cost to him?

The problem is that if it gets treated as income as opposed to expenses, it could affect his housing benefit.

[northernladuk]

The problem is that if it gets treated as income as opposed to expenses, it could affect his housing benefit.

Daaaaamn! That sucks monkey balls. I see his dilemma now. I though it was just a matter of going to Skegness for holiday instead of Disneyland this year to balance to books.