Don’t let them in…… The end. Jokes aside, if HMRC do show up at your premises you have rights and they must follow a set of rules.
Why do HMRC do unannounced visits?
- To investigate criminal activity
- To check records and tax position
Do I have to let HMRC into my business premises?
If they have a signed warrant from a judge, you have to let them in as it’s highly likely they are investigating criminal activity. Without an official warrant, they have no right to gain access and you or a member of staff can refuse entry.
What happens if I don’t let HMRC into my premises?
The worse that can happen is that you’ll be charged a penalty of £300 and then £60 a day if they deem that there wasn’t a reasonable excuse for allowing the inspection to take place. In most cases they will leave and send a letter out to arrange a planned visit, which can be done at your accountant’s office without you being there.
What’s a reasonable excuse for not letting HMRC into premises?
A gang of officials in hi-vis coats turning up to a restaurant full of customers doesn’t look great for your reputation and can also cause disruption to a night’s business. Having people dining in your restaurant and not having your accountant present are reasonable excuses to turn them away and arrange another time that’s more convenient.
What if HMRC show up and you’re not there?
If HMRC turn up at your business premises and you’re not there, they must not:
- Force entry
- Conduct a search
- Interview any staff
- Inspect cash on the premises
- Enter parts of a home not used for business
If HMRC turn up unannounced and you do let them in?
- Ask them to enter the premises discretely and away from customers, maybe via the back door into the office.
- Check inspection notice is signed and shows correct date and time
- Check identities of HMRC officers in attendance
- Contact your accountant!
Questions to ask HMRC if they turn up at your premises
- Why do they suspect high risk or tax fraud?
- Why can’t they conduct enquires with an announced visit?
- Why is the visit required?
- Why have they chosen the time to make the visit, especially if it’s not between the hours of 9am-5pm, and why they consider it to be a reasonable time?
Overall the main two things to take from this is if HMRC arrive unannounced at your restaurant are: DON’T LET THEM IN AND RING YOUR ACCOUNTANT!
My Accountancy Hub have masses of experience dealing with tax enquiries, especially in the restaurant and catering industry. If you need help with anything contact us online, or call 0151 931 2724.
