HMRC enquiries and fee protection cover
We have recently started offering and speaking to our clients about professional fee protection insurance and have seen a fairly encouraging uptake, but not in all cases!
I recently met with a long standing and respected client and was quite taken aback when he claimed that “if you chaps had done your job properly in the first place, then HMRC would not be making an enquiry”.
Of course even if you are happy that your accounting records and tax affairs are in good order, this does not mean that you will not be selected for an enquiry.
After explaining to our client that HMRC are empowered to look into the tax position of any taxpayer, regardless of whether all returns and payments have been made on time, we went on to explain that clients may have to justify not only their accounts, but also their personal income and lifestyle in the event of an enquiry.
It is fairly common knowledge that HMRC are carrying out more enquiries in an attempt to close the tax gap between what they believe is due to them and what they collect. Added to the new, far-reaching powers of inspection it is likely to mean that the number of enquiries will continue to increase and that they will become more in-depth.
Investigations can take considerable time to resolve, typically 19 months (although many take several years). During this time, advisors’ time and therefore fees could rapidly mount; but subject to certain limits and exclusions, would be covered by the fee protection product we are able to offer. Going back to ‘our chaps’ view on the involvement we have had in preparing and submitting the original returns, we should of course as accountants and advisors, be best placed to deal and liaise with HMRC in the event of an enquiry
With the infamous mis-selling of PPI in the past, and an extended warranty being offered with pretty much every consumer purchase we make these days, clients will of course act on personal attitudes to insurance policies and risk. However, having had first hand experience of what can happen should a client be picked at random for inspection, we are pleased to be able to offer this type of product and hopefully offer peace of mind in the event of an enquiry.
We are continuing to highlight the benefits of our fee protection service to new and existing clients and offer a package designed to reimburse the cost of representation in the event of an enquiry, tailored to cover corporate, partnership, sole trade and personal taxation matters.Talk to Barnes Roffe today