Our health checks are designed to identify and rectify any potential PAYE or VAT problems in a business before they’re uncovered by HMRC. Regardless of the sector in which you operate or the type of work you specialise in, our health checks are relevant to all businesses. They play a key role in helping ensure your business is compliant.
In the case of PAYE, it’s not uncommon for businesses to not realise that their existing processes, regardless of how tried-and-trusted they might be, do not comply with the latest tax legislation. Staying on top of the intricacies of PAYE and the latest rules and regulations is an on-going challenge that can easily catch so many businesses out.
It’s precisely why health checks are so invaluable in making sure businesses don’t get stung by any nasty surprises. Our health checks concentrate on the common problem areas that HMRC tend to focus on, which include:
- Payroll – is everything that should be taxed actually being taxed and are processes in place to ensure to check this e.g. bonuses, vouchers.
- Benefits in kind and P11D forms – have all benefits and expenses payments been correctly reported on P11D forms and have Class 1A/Class 1 NICs been correctly charged?
- Expenses – has the payment or reimbursement of expenses been properly controlled and have all expenses been correctly categorised (e.g. no charging staff entertaining to client entertaining)?
- Status – are the suppliers genuinely self-employed or do they have any regular workers (cleaners are a favourite target) who should be on the payroll?
- Directors’ loans – if the employer is a company, have accurate directors’ loan accounts been written up so that any overdrawn balances can be appropriately dealt with?
In our experience, the most effective VAT health checks are those that, at the very least:
- Provide businesses with peace of mind that their VAT affairs are in order prior to any HMRC VAT inspections
- Identify potential issues and provide advice on corrective measures to avoid or reduce arrears, penalties and interest
- Highlight any potential savings and/or cash flow benefits
It’s also worth bearing in mind here that if you are looking for somebody to review your VAT affairs, where possible, enlist the expertise of an organisation that employs former HMRC VAT inspectors. It’s something we do here at Ormerod Rutter and it gives us, and our clients, peace of mind that their books are being analysed in exactly the same way HMRC would approach them.
PAYE and VAT health checks aren’t a compulsory business requirement. However, they are a highly beneficial practice that not only make sure you haven’t got any sudden PAYE or VAT-related HMRC issues heading your way, but that you’re fully taking advantage of all of the options available to you.
For more advice or to find out more about our PAYE or VAT health checks, contact us today on firstname.lastname@example.org or 01905 777600.
Anthony Middleton is responsible for monitoring all of Ormerod Rutter’s tax investigations and deals specifically with Corporation Tax and Income Tax enquiries. He has been a member of the team for 13 years.