I've just had my first VAT inspection in years. There was never going to be a problem but you always wonder if you've made a mistake. It started with the usual questions to the client about the business, how they invoice, expected margins, sales of assets and that kind of stuff and of course I'm trying to interpret what they really want to know and interject. I was surprised when the inspector asked if my client had other sources of income and I asked if he wanted to know about the company whose books he was inspecting or my client the individual. He said both and I asked what relevance my client's income had to the company's VAT records. He said he was after an overall picture.... The other thing of note was that they had clearly looked at great detail at the website, methods of payments received, number of years in business etc and asked questions about all these.
They then did the usual check of invoices, making sure receipts had vat numbers, looked at bank statements, etc.
Anyway upshot was a clean bill of health so need to worry!
How long did it take? I've got one on Monday. I've had to phone them up and explain there are going to be problems (prior to me starting) as VAT returns have not been done and that was taking time to sort. I said to her that I only live a couple of minutes away and would be available to come down at any time (although I'll be there at the start). How long did the going through records take?
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Never buy black socks from a normal shop. They shaft you every time.
Hi Peasie, this one didn't take much more than an hour as it was the first vat quarter so only the one to check but I have been on inspections that took most of the day, really depends on the size of the business. Years ago I had one for a new client that I had to go back years and the inspector was pretty good, just happy that we were getting it sorted really. I'm sure you will be fine!
Took about half a day but that was because they decided (there were two of them!) that in the records they had verified they didn't find any problems that concerned them, so they did not feel there was any point spending a whole day.
They also asked about other income, also his wife's occupation. I got the feeling they were "testing" his income against his life style.
Yes I would think that was the reason Bill but should we allow them that luxury when they have asked to inspect the VAT records of the company only? I kind of just made the point that it was relevant to what they had asked to see but we still answered the question!
Think it must be inspection time full stop, as we have a "check of employer records" visit next week and there are only myself and one other on payroll!
Best part is the letter from HMRC states that visit should be complete "within 1 day" and there are two of them coming .
My guess is it will take 20 minutes and that includes the coffees
Well she was thorough enough in the inspection. I was surprised that with a turnover of not far off £300K she was picking up on four or five invoices for £20 and asking more details. And then quibbling about totals being about 80p out before I said that difference between the VAT Return and the totals on the spreadsheet was in the VAT Return the box 6 and 7 figures you chop the pennies off. My spreadsheet still had the pennies for each month and added up came to about 80p.
Nearly 6 hours I was there. I was hoping to get away while she went through the paperwork. I was only a four minute walk away and I'd said to her on the phone I'd be available to pop back at any time. But the client wanted me to be there. Normally I have a Twitter break every so often during the day to break things up. It's rare I go 6 hours Twitter-less.
She seems happy enough with what I've done - she now wants the earlier stuff in ASAP.
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Never buy black socks from a normal shop. They shaft you every time.
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