Reply to: VAT investigation

[Fred Bloggs]

Because they are so routine, the representation at the audits themselves are not covered. If it develops into an enquiry, however, the insurance will kick in.

Obviously give us a call if you do receive notice if an inspection and we'll provide support/advice as necessary.

Thank you for the clarification.

[Qdos Contractor]

If I get this (I'm insured with QDOS for TLC35) do I inform QDOS, or just handle it myself? AFAIK I'm squeaky clean on VAT anyway, thankfully.

Because they are so routine, the representation at the audits themselves are not covered. If it develops into an enquiry, however, the insurance will kick in.

Obviously give us a call if you do receive notice if an inspection and we'll provide support/advice as necessary.

[tim123]

A contractor colleague sat next to me has just received a call from HMRC, saying they're conducting a VAT investigation, and would like to come round to his house and take a look at documentation etc.

I advised him to speak to his accountant right away (He's on the phone now).

Any advice on his initial moves?

Book a suitable day off work!

As a VAT registered entity you can expect to receive one visit from the VAT inspector every two-three years.

Though if you're a good boy they seem to wait 5-6 for subsequent visits.

This is all perfectly normal, something that you must comply with and (apart from the exact choice of date) outside of your control

tim

[Fred Bloggs]

I would be very, very surprised if anything like that happened. Massively unlikely. As most other people have said, VAT reviews are generally painless and routine unless you've been an idiot.

Definitely not worthy of a patio burial.

If I get this (I'm insured with QDOS for TLC35) do I inform QDOS, or just handle it myself? AFAIK I'm squeaky clean on VAT anyway, thankfully.

[Cheshire Cat]

I reckon it's the latest variant of the 419 scam. If they ask you to "hold" some VAT funds for HMRC, beware.

[Qdos Contractor]

What's the likelihood that this could escalate into further investigations, such as IR35 - even if the VAT side is clean?

I would be very, very surprised if anything like that happened. Massively unlikely. As most other people have said, VAT reviews are generally painless and routine unless you've been an idiot.

Definitely not worthy of a patio burial.

[DaveB]

What's the likelihood that this could escalate into further investigations, such as IR35 - even if the VAT side is clean?

Minimal. They may all be one big happy family now but that doesnt mean they actually talk to eachother ( like most families really ). More likely to get an IR35 investigation off the back of a PAYE/NI visit.

[ChimpMaster]

What's the likelihood that this could escalate into further investigations, such as IR35 - even if the VAT side is clean?

[xoggoth]

I had a VAT inspection early on, the chap stayed about 20 minutes and said everything's fine. A contractor's affairs are pretty straighforward from a VAT point of view, if your accountant says no probs there probably aren't.

[Gonzo]

I advised him to speak to his accountant right away (He's on the phone now).

Any advice on his initial moves?

Yes, speak to the accountant.

But, from everything I have ever read (I haven't had an inspection myself), the VAT people are nice people so long as you don't get on the wrong side of them.

So, provided the returns and payments have all been up to date, it probably is a friendly visit.


My local VAT office keep inviting me to seminars that they put on to help local business out. They probably don't realise the effect that it has on you when you see a brown HMRC envelope that you are not expecting appear on the doormat.

[Jubber]

Sounds like a standard 'visit' to me. I thought that they try to visit all traders on their patch every three years? This may have changed. I will ask my contact.

[BrilloPad]

normally gets triggered if something has flagged, such as when a form wasn't filled out correctly. Hopefully a false alarm.

I thought they tried to do a routine visit in first few years?

[BlasterBates]

normally gets triggered if something has flagged, such as when a form wasn't filled out correctly. Hopefully a false alarm.

[moorfield]

Accountant says 'nothing to worry about', they'll have to liaise directly with them, and all the documentation is tip top.

Yes, don't panic, and hide behind the accountant. Shouldn't be a problem if copies of all invoices, vat returns, bank statements are available to prove it's all been calculated correctly and paid on time.

[realityhack]

Accountant says 'nothing to worry about', they'll have to liaise directly with them, and all the documentation is tip top.

Could this be a false alarm? We hope so. Tune in next week for more exciting tales from the code face.