Unannounced VAT Compliance Visits

Every year HMRC carries out checks to make sure that tax payers are paying the right amount of tax, accounting for right amount of output VAT and claiming the right amount of input VAT. These are called compliance checks.
As part of a check, HMRC may wish to visit you at your business premises. This is so that they can look at your records or business assets and find out more about how your business operates.

What are your rights?

You do not have to agree to this visit if you don’t want them to do it at that time.You have the right to contact your tax adviser if you have one.You have the right to confidentiality in all their dealings with you and anyone else involved in the check.

Why HMRC does unannounced visits?
HMRC sometimes makes visits without telling you in advance because of several reasons. It may be the case that HMRC has made previous appointments to visit but you have not been at your business premises as arranged or they have not been able to contact you to arrange an appointment.

HMRC sometimes believes that they have identified concerns that can only be dealt with by an unannounced visit. However they can only make an unannounced visit if a senior HMRC officer agrees. The senior officer will consider whether they can avoid an unannounced visit by getting the information they need in another way. If they decide that the visit is necessary, they will decide accordingly.

Can you refuse the visit?
If you refuse the visit, it’s likely that they will ask you to explain as to why the visit is to be cancelled. It could be the case that the day, time or place is inconvenient. In that case HMRC will try to arrange another visit.
Alternatively, HMRC may try to get the information they need by contacting someone else or estimate the figures they need and make an assessment of what you should pay. They can also decide to make another unannounced visit in future or ask the independent tribunal that deals with tax to approve a visit.

What happens during the visit?
HMRC officers will show you their identification when they arrive and they will explain why they are visiting. They will give you a ‘Notice of Inspection’ that sets out certain the names of the officers taking part in the visit and a contact number for you to check their identities. They also will explain what the officers can do during the visit and their legal rights to carry out the visit.
HMRC may ask to take some records away to check in their own office. They will explain why they want to do this at the visit. If they do take any records, they will give you a receipt, keep the records securely and return them to you by the end of the check. If you need them back quickly.

If you require further information in relation to this aspect or any issues covered by this aspect, please contact our office on 020 8768 5628.