Friday 15th January 2010 - Published by Robert Trigg - Communications Executive
Small Business Tax Bomb About To Explode
A call for small businesses “to defuse the tax bomb that is about to explode” has come from Des Desai of self employed specialists, MrTax CD.
Stressing that ignoring the January 31 tax return deadline was not an option he pointed out that some businesses might even be owed money.
“Christmas, the big freeze, lack of money for an accountant and the possibility of a tax bill may all be reasons why so many people put off doing their self assessment, but there’s now even more reason than usual to keep on the right side of the tax people,” declared Mr Desai.
He continued, “Her Majesty’s Revenue and Customs (HMRC) now classifies anyone who doesn’t do what they are told as a potential tax cheat, although, the new HMRC customer charter says they will treat you as honest, that’s assuming you are communicating with them. Let’s be clear, it’s not just celebrities and other high earners who can feel the wrath of the tax regime.
“Here’s some of the ways HMRC can now really turn the screws on you:-
• Not keeping ‘good’ business records – a whopping £3,000 fine. A trap that could ensnare every self employed trader I’ve ever known. HMRC can now appear on your doorstep with 24 hours notice and demand access to all current business records.
• Alternatively, HMRC can determine by its own rules that a trader has ‘carelessly or deliberately’ underpaid tax and in the worst cases the fine can be up to 100 per cent of the tax due.
The devil is in the wording. How does anyone define ‘good’ or ‘careless’ for instance?”
The good news, said Mr Desai, was that almost any self employed business could do its own tax returns and not spend out on an accountant, or just use one for specialist tax advice where necessary.
Businesses could simply register on the HMRC web site for a security PIN by January 21 and still have time to complete a tax return using the free online service.
“Getting tax returns completed on time puts you in the HMRC good books and dramatically reduces the stress factor,” he declared, adding that those who don’t have their accounts ready can still deal with the situation.
Continued Mr Desai, “Here’s a little known device used by accountants especially for late January clients – use estimates and tick the appropriate box. You can then apply to submit accurate figures later.
Keep more. pay less tax -legally.
