Random Tax Enquiries

[leighc]

My mother has been advised by her accountant that random tax enquiries are becoming more common resulting in "innocent tax payers being forced to pay tax that is not due, as they are unable to justify the cost of defending themselves". How common are these enquiries? She is now really worried about huge accountants' bills if she is the subject of an enquiry. What sort of things would the Revenue be likely to ask & is it something we could sort out ourselves (if it happens)? The accountants file her tax returns each year, for which she posts them all the relevant statements etc. She has several pensions & supplements her income from savings. Her tax liability is currently in the region of £1,200 pa. Are these enqiries really "random"? (Am hoping there is someone who can answer the above over the Christmas break as would like to discuss this with my mother asap).

Many thanks in advance.
Leigh

[jpcentral]

Your mother's accountant isn't trying to sell her insurance by any chance?

The Revenue's computer system is becoming more and more sophisticated so a large number of enquiries result from anomolies spotted by the computer.

There are more 'random' enquiries but if your mother's tax return is as straightforward as you say, I can't see that an enquiry should be a problem. Nothing seems to be possible to dispute; she will have received full documentary proof of all of her income and won't be claiming any expenses. Presumably she can account for all transactions into and out of her bank.

I would tell her not to worry (unless she's not declaring something) and have a relaxing Christmas.

John Perry
Central Business Services
Loughborough
www.centralbusiness.co.uk

[leighc]

Thank you so much John. The accountant is offering a "gold service" - an annual set fee in addition to existing charges - which in effect would I guess be insurance against extra expenses incurred in any investigation. I tend to agree with you that if any investigation should arise, we would be able to deal with it ourselves if necessary. The trouble is, particulary with an "older" person, once the seed of doubt has been sown ....!
Thanks again for your advice & a prosperous New Year to you!
Leigh