HMRC ramps up investigations, flusters small business owners

Industry news roundup: week ended 24 Oct 2013:

It seems the taxman can’t seem to get much right nowadays, whether it be hunting down tax evasion or making it easier for smaller businesses to file taxes.

Her Majesty’s Revenue & Customs has been partially vindicated recently for ramping up its VAT evasion efforts last year, as new data revealed that large firms hauled across the coals by the tax authority siphoned £1.44 billion back into the Treasury’s coffers. Of course the reason why the taxman raked in shedloads of cash during the 2012-2013 financial year is that it was taken off the leash by the Government and given the authority to ramp up the penalties it can levy against recalcitrant companies that aren’t forthcoming with their tax information during an investigation.

I’m sure ministers are quite chuffed to see that extra cash come flowing in, but not everyone is happy with HMRC and its new policies. Small business owners are particularly less than thrilled with the taxman’s new focus on digital and online tax filing.

Listen, I get it – you’re saving money by not generating reams and reams of paper waste. That’s commendable, really; it cuts down on costs and is more environmentally friendly to boot, so well done you. I’m sure massive companies with their own accounting departments can manage quite well with the change, but not every small business in the UK is as well equipped to handle online tax filing systems.

Unfortunately HMRC is pushing to phase out paper filing completely, despite the fact that such a decision could leave many SMEs completely high and dry. It’s bloody inconsiderate, if you ask me – not that the Government is soliciting my opinion – and it’s a true disservice to the contributions SMEs make to the British economy.

I mean yes it’s all well and good that the taxman pulled in nearly one and a half billion from VAT evasion investigations, but SMEs are a constant and steady source of not just tax revenue but just general economic stimulation. In a financial landscape that saw large firms that were supposedly ‘too big to fail’ crashing and burning left and right, small businesses soldiered on doggedly, dragging the UK kicking and screaming out of the recession, and this is the thanks they get? It’s bloody unfair and I hope some exceptions will be made in the future to reward SMEs instead of penalising them.

 

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