HMRC revises plans to check SME book-keeping

News Article - 29 September 2011
Category: Regulatory

The Taxman's ambitious plans to review small business' record-keeping have been revised, it has recently emerged.

HM Revenue & Customs (HMRC) will now investigate 20,000 business' records - a significant reduction from its original target of 50,000.

The original business plan included 20,000 record check visits to have been completed by March 2012, although this has been revised on a pro-rata basis of 12,000.

An HMRC spokesman said: "Currently, having undertaken pilots initially and by building up the numbers in a measured way, HMRC is seeking to develop and refine the BRC approach before introducing it on a larger scale."

Nevertheless, HMRC's director of local compliance, Richard Summersgill, believes small businesses should maintain adequate record-keeping with the incentive of avoiding interest and penalties simply by paying the right amount of tax.

"Adequate records give businesses a clear idea of their trading position and profitability, allowing them to make business decisions and adjustments to ensure survival and success," he said.

"And where a check has shown a business keeps adequate records, it gives HMRC a greater degree of assurance as to the likely accuracy of its tax returns."

In order to maintain adequate record keeping businesses not only need the right information but the tools to manage company financials with the ability to analyse all areas of the business.

With business accounting software SMEs can combine their sales, purchase and nominal ledgers with the ability to store a lifetime of transactions for their entire business.

The benefit for small businesses is that these accounting solutions are not only robust and scalable, they are fast and secure with no practical limit to the amount of records and transactions a business can process - perfect for the developing, growing UK business.

Article keywords: small business, book keeping, tax, accounting software, accounts software, finance software

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