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Where Taxpayers and Advisers Meet

quick, possibly stupid question.

keaton
Posts: 18
Joined: Sun Jun 09, 2013 7:52 pm

quick, possibly stupid question.

Postby keaton » Tue Nov 26, 2013 5:27 pm

I've read hmrc can go back 6 years in a investigation, but what if the business has only been running 2 years? Are you expected to keep household receipts and such for years prior to the business starting up.
Sounds like a stupid question but I'd appreciate any input.

wamstax
Posts: 1869
Joined: Wed Aug 06, 2008 3:39 pm
Location: Operate Nationally but based in Aberdeen
Contact:

Re: quick, possibly stupid question.

Postby wamstax » Tue Nov 26, 2013 9:34 pm

The period that HMRC can go back will depend on a number of circumstances.

For example if you had no previous tax history before you commenced your business or you were an employee with no scope for being involved in tax evasion then HMRC would not consider going back earlier than the day you started in business.

If however you were an employee and had scope for tax evading activities such as doing jobs on the side or cash in hand then of course HMRC might consider looking at your financial position for up to 12 months before you commenced your business if for example they saw your tax evasion as being "deliberate". Remember you could have evaded tax by omitting taxed income from any tax return and your income was such that you fell into the higher tax rate brackets.

Inevitably there can never be any hard and fast rule as it will depend on both your tax evasion that is discovered and/or the tax official that takes up your enquiry
regards and hope this helps
http://www.wamstaxltd.com
Operates Nationally with competitive costs
and email and phone contact can be obtained from website


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