Small businesses across the country are now experiencing various courses of action from the taxman. There are now random examinations to tax amnesties, where the HMRC have been using various techniques just to ensure that all businesses in the country are paying the right taxes. If they don’t, they need investigation insurance to back them up.
When the tax returns are audited, it can pose a major problem to many business owners. Even if they have paid the taxes properly, an investigation is possible and can be expensive. Appealing against the HMRC can be a tedious and costly process. So, let’s know what this agency is doing and how one can protect his business from them?
Knowing the Taxman’s Job
Due to massive losses of revenues triggered by tax evasion, the HM Revenue and Customs have started some disciplinary action for some specific professions. It has determined some areas where it thinks tax evasion is abundant, and where they can make easy wins by getting back what is due.
The disciplinary action has been followed by tax amnesties. Like the plumbers for instance, the agency provided an opportunity for plumbers to completely declare their income and make more lenient penalties. Those who opted not to benefit from the amnesty were advised that they can face stiffer fines if they were found guilty of inaccurate returns.
As reported previously, the HMRC are now starting with its post-amnesty crackdowns, where several plumbers are facing investigation. This should entitle them to an investigation insurance so they won’t be penalised for such action.
But it’s not only plumbers who are in question. Entrepreneurs in every sector must be aware of the risks of tax investigation and they need to take drastic steps to minimise the risk.
How Can Insurance Help?
Many business owners and entrepreneurs have taken their step to availing investigation insurance to protect them from potential costs related to the tax investigation. It’s an insurance type that will defend the covered from HMRC actions including investigations like Self-Assessment, VAT and PAYE. It can also help pay out if you choose to appeal in the local court system. A good coverage can also help you get legal and tax advice whenever you need it the most.