In the Panthera office this week we’re dealing with a VAT investigation for one of our clients. These come about for all VAT registered businesses and I would expect to have one every 6 years or so. Some industries come under more scrutiny than others – the building trade once again seem to feel the brunt of this one – and especially if you are de-registering or claiming back VAT regularly.

So what should you do if an investigation is opened? Don’t panic! The VAT inspector is generally pretty personable and as long as you respond to their requests within the time frame they give you shouldn’t have a problem. They will normally ask you to provide accounts and then want to drill down into particular transactions so expect to spend some time photocopying your receipts and sending them out to the inspector.

If you’re using our brilliant More software then providing the data they require is a piece of cake – you’ve already got all of your receipts numbered and filed so they’re easy to find and normally a print out of your VAT reports and P&L will give them much of the information that is needed. And we’re always on hand to help out so give us a call.

Where this gets tricky is if you are keeping paper or spreadsheet records as you probably won’t be able to cross-reference your original documents. This is one of the main reasons we ask all of our clients to use our software – without it you could end up with a big headache when it comes to an investigation.