Reply to: Request for VAT inspection

[Gonzo]

To close the thread ..

VAT inspector came, looked at bank statements, and compared with Box 6 figures on all returns to date. Looked at my excel comp of invoices per period and VAT calcs. Drank 1 cup Earl Grey, refused biscuits (smell of rat poison must have been overpowering.)

No excitement, no story.

That's not the way things work around here. The creator of a thread does not automatically get the right to decide that it has run its course - just look at "test please delete".

But thanks for sharing this with us. It is always useful for the rest of us to hear about the experiences of someone who has actually been through one of these brushes with HMRC.

[lexington_spurs]

To close the thread ..

VAT inspector came, looked at bank statements, and compared with Box 6 figures on all returns to date. Looked at my excel comp of invoices per period and VAT calcs. Drank 1 cup Earl Grey, refused biscuits (smell of rat poison must have been overpowering.)

No excitement, no story.

[lexington_spurs]

Update

Hobnobs bought - VAT person visiting head office in about a months time. MyCo will be providing services remotely to ClientCo that day.

OP's accountant suggested ringing them to ascertain whether it was really worth their while coming to see a fistful of invoices. The bank statements bit was wrongly posted.

[Alan @ BroomeAffinity]

A VAT inspection is an extremely straightforward affair for a one man contractor company. What you'll need to provide is - assuming FRS:

• Sales invoices
• Bank statements
• Copy accounts
• Purchase invoices for any capital items you've reclaimed on

(You may also need to satisfy the VATman that you are on the correct flat rate)

If you're not on FRS, you'll also need to provide purchase invoices and receipts for any VAT you've reclaimed.

The VAT man will then make sure they all match up. If they do, they'll be gone and you'll not hear from them for years.

A couple of other points:

1. I think it was Ardesco who mentioned the registered office thing: A VAT inspection will normally take place at the place of business which is often distinct from the RO so they'd probably still come to your house - if thats the place of business.
   
2. The OP's accountant really should know that the VATman should be given the bank statements.

[sal626]

If you haven't fiddled your VAT returns, you got nothing to worry about...

Had one a some years ago, this is before I was a contractor...had a small web development company, working from a converted loft.

Vat guy came, had a cup of tea, went over the files over about 3 hours, had lunch, asked a few questions and left.
They do get pedantic though....so best advice is to prepare all your files (invoices, receipts, bank statements, etc) beforehand.

[Archangel]

Just to add to the other comments, mine was at my home, pretty straightforward, showed them (as far as I can remember):

Invoices raised
Receipts kept
Spreadsheet on which I kept the "current picture" of the business and calculated the vat (before FRS).

They pointed out that I could claim some VAT back on the mileage expenses.

They ate some hob-nobs and left.

Don't worry too much.

[xoggoth]

Had one, no probs. VAT is pretty straightforward for a contractor. No real grey areas and little scope for major errors.

[TykeMerc]

I've had a couple of VAT inspections over the years, both were straight forward and friendly visits.

I was given useful advice by the inspector on the first visit that my Accountant had missed.

[tim123]

His advice was to query if they really wanted to come on site to look at a handful of invoices when they could do it by post.

They don't want to look at a handful of invoices.

They spend 2-3 hours totalling everything up, looking at whatever documents they think necessary (at my first they wanted to see my "contracts" to make sure that the payments in matched the contracted amounts) to check that you are:

a) not making school-boy errors.

b) not running a fiddle.

tim

[Flopsy]

Have had 2 VAT inspections over a large number of years. 2 different companies. All straight forward and OK. Low key.

I didn't feel put under a looking glass and they didn't look too closely. Nothing to hide anyway. I just mean that they weren't too officious or "jobs worthy".

Good luck.

[lexington_spurs]

My reply seems ruder than was intended - cuk is getting to me.

His advice was to query if they really wanted to come on site to look at a handful of invoices when they could do it by post.

[tim123]

tim - interesting tangent regarding inviting vat people to a client!

other views like "change your accountant" because he suggested trying to resolve it by post - excellent, thanks.

I made that suggestion because he said "don't let them see your bank statements"

It is pretty obvious he has never encountered a VAT inspection before if he thinks that is the slightest bit possible.

Do you really want to be using an accountant who knows zip all about the VAT process?

As to visiting you at the client, well I suppose that this might just be possible is it is within the same general area (but then you wouldn't be losing enough hours to worry about, would you ). But if you are working away from home there is no chance.

I had to take two days off for the last one because the bugger only worked Tuesday to Thursday and I was on a Mon-Fri Commute.

tim

[lexington_spurs]

tim - interesting tangent regarding inviting vat people to a client!

other views like "change your accountant" because he suggested trying to resolve it by post - excellent, thanks.

[BolshieBastard]

Change your accountant!

I had an inspection about 7 years ago. They sent a lady to my home who went through all the docs I supplied. She told me I'd over paid £200+ and said to claim it back on the next return. And I wasnt on the FRS.

If you're on the FRS, I dont see what you're bothered about unless you've been putting through stuff you shouldnt have.

[tim123]

Sit tight and wait for them to get in touch. If they refuse to do it by post or on Saturday, speak to your Accountant, have a meeting with them and then arrange to meet the VAT man and say that you plan to invoice them for loss of business. I can't really suggest anything else to be honest.

Having a VAT inspection is a cost of doing business. If you don't want to suffer that cost the solution is easy, don't register.

The idea that you can bill them for lost time (and that they would pay) is ridiculous.

tim