Hector's Spring Surprise ...

[threaded]

Yes, there's nothing that'll wake you up quite so fast as a Inland Revenue Officer with a machine gun at the bedroom door. It would certainly make it easier to agree 'accurate' figures.

[AlfredJPruffock]

Private residencies could also be visited by officials wanting to inspect business assets or stock kept on the premises.

Tax officials could also pay visits to personal taxpayers, in cases where they have failed to provide requested information. The consultation document said this would be an option “especially in cases where understanding of tax may be limited”.





Businesses face surprise raids from tax inspectors suspicious about their affairs, under proposed new powers for Revenue & Customs.

Officials are seeking rights to enter business premises and examine goods and records as part of investigations into corporation tax liability, according to a consultation paper published on Thursday that advisers warn could impose extra burdens on small businesses.


Private residencies could also be visited by officials wanting to inspect business assets or stock kept on the premises.

Tax officials could also pay visits to personal taxpayers, in cases where they have failed to provide requested information. The consultation document said this would be an option “especially in cases where understanding of tax may be limited”.

The consultation paper will fuel concerns that Revenue & Customs, which was created in a merger two years ago, wants to extend the substantial powers enjoyed by Customs officials to officials dealing with direct tax.

A decision to give the power of arrest to some direct tax officers has already sparked controversy.

The alignment of powers has been a sensitive issue because of accusations that Revenue & Customs has become more aggressive since its merger. But Revenue & Customs has promised to introduce clear safeguards, issuing a consultation paper on Thursday to examine the “adequacy and effectiveness” of existing measures.

John Whiting of the Chartered Institute of Taxation said he welcomed the tone of the consultations, which appeared genuinely to acknowledge the need for safeguards.

In the document, Revenue sought to reassure business that wherever possible they would address concerns through correspondence and telephone discussions.

But it justified its move to give corporation tax inspectors the same right to enter premises as VAT inspectors on the grounds it would make it easier to agree accurate figures.

Revenue & Customs said its officers needed “to obtain a first-hand impression of the business and how it operates” properly to check the accuracy of tax returns.

Although visits to businesses would normally be arranged in advance, an element of surprise was needed in cases where “the taxpayer might decamp, or stock or other assets might be removed, or employees laid off or relocated or business records cosmetically tidied up for the occasion”, the consultation document said.