Small businesses face fines for missing paperwork
Jan 04 2012
The move from HMRC represents yet more red tape for small businesses to contend with
HM Revenue & Customs (HMRC) is threatening tens of thousands of small businesses with fines if they fail spot checks on their paperwork.
The crackdown comes despite a government pledge to cut red tape and regulation for small businesses.
Companies that are found to have failed to keep or preserve records ‘in real time’ can be fined up to £3,000.
Under HMRC’s plans to expand the checks, as many as 20,000 small businesses will face demands to show receipts for income and expenditure. Those who are unable to do so will face penalties, which business leaders warn could push some into bankruptcy and hit the economic recovery.
Lee Perkins, managing director of Sage’s small business division says that the Business Records Checks initiative simply increases pressure on the UK small business community at a time when many are being forced to take pay cuts to secure the future of their companies.
‘The actions of HMRC are in direct contrast to the government's stated commitment to support UK SMEs by cutting red tape and despite receiving widespread criticism from small business groups, it is unacceptable that HMRC will continue to push ahead with the programme until at least the end of the financial year,’ he adds.
‘If small businesses are indeed the engine room to drive the UK's economic recovery, they must be provided with conditions for growth, rather than increased regulation and costly bureaucratic processes.’
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