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29th September 2010
Self employed advised over tax records
Self-employed workers have been advised to be extra careful with their VAT and general tax records in the coming months.
It recently emerged that the that the government is planning to spend £900 million over the next four years on investigating tax issues, in an attempt address the £42 billion tax gap.
Consequently, it is thought that the self-employed will be among those facing increased scrutiny from HMRC, as mistakes on tax returns are relatively common from such workers.
Richard Mannion, of chartered accountants Smith & Williamson, said consideration should be given areas such as keeping records when using assets for both business and personal use.
“Similarly, if you use a car for both business and personal use you need to keep a log of mileage associated with the business and hold onto receipts for petrol and any repairs,” he said.
Mr Mannion added that VAT is “high on the taxman’s agenda”, especially since HMRC recently estimated that around £15 billion of such contributions had been underpaid.
“Clearly, it will be eyeballing many businesses' VAT returns,” he added.
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