VAT compliance: increased scrutiny by HMRC

6 January 2025 / Insight posted in Articles

As we have seen from the announcements made in the recent Autumn Budget the new government is making their measures to ensure tax compliance and tax payments a high priority. This includes a significant recruitment programme to ensure accurate and compliant tax filings, and timely tax payments. Recruitment has begun on the additional 5,000 HMRC staff to focus on compliance, with many of these earmarked to be VAT inspectors.

We are already seeing clear indications of HMRC actively increasing their inspection of VAT return filings and taxpayers, and we fully expect to see this inspection process ramping up in 2025, and beyond.

The reasons for the increased scrutiny are essentially twofold: HMRC are catching up on inspections (in person as well as online) since the COVID pandemic, and the recent change of government has led to a greater focus on compliance, with the objective of boosting tax yields and decreasing the tax gap.

Preparation is always more effective than reaction. Therefore, are you ready for the increased VAT checks and inspection process that HMRC are implementing? As well as understanding the powers HMRC have to inspect the business and ask for information, and for access to your records, it is essential to have an awareness of how an inspection process works in practice. At Moore Kingston Smith we are seeing significant proactive efforts by HMRC to check the VAT affairs and compliance systems of our clients; we recommend that you should be acting without delay to prepare for this.

Maybe you need help now with a current inspection. If not, you should be getting ready now for any future HMRC inspection and further scrutiny.

Our guide provides you with practical, pragmatic and clear information and tips about how to deal with HMRC. This covers the whole inspection process. It also explains how we can help you and leverage off our very significant experience here at MKS.

 

Download the guide

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