Since the onset of the new penalty regime, we have seen a more aggressive approach from HMRC. In one case, the accountant had completed the tax return and inadvertedly not added back depreciation. HMRC picked up the error and wrote to the accountant/client who agreed the error straight away. HMRC have written saying they believe a penalty is due of up to 100%.
This is not correct. 2020 Tax Protection have previously pointed out the importance of considering penalties immediately should any errors come to light. When agreeing to any error, get your defence in first by explaining the reason behind the error and pointing HMRC in the right direction before they issue threats of much higher penalties. Accountants are finding themselves arguing from higher figures downwards rather that the better option of lower figures upwards.
Incidentally, acting on our advice, the accountant is hoping for a nil penalty.
For further details please visit our website, call +44(0) 1268 494 317 or email info@2020taxprotection.com.
