I picked up on a consultation doc issued by HMRC last week entitled 'Business Record Checks'. This seemingly innocuous sounding document has quite important potential ramifications for all small business owners - the full text can be found here, though I'll attempt to quickly summarise.
Existing legislation exists concerning the records all businesses must keep, along with the additional records needed by VAT registered firms. HMRC have always had the ability to levy penalties for inadequate record keeping, though in reality these have not often been used.
HMRC estimate that tax loss due directly to poor record keeping is a factor in 40% of random enquiries - they therefore propose to check the records of up to 50,000 businesses annually, beginning in second half of 2011.
That timescale is actually rather soon, if your records are not currently up to scratch!
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