HMRC tax enquiries target the media and creative sector

Recently, H M Revenue & Customs (“HMRC”) have been opening a number of tax enquiries into individuals and businesses, in the media, creative and technological sector.

Online influencers and personalities operate in a fast-growing industry and HMRC are increasingly turning their attention on to taxpayers operating in this sector. This is to ensure that they are disclosing and paying the correct amount of tax falling due.

If you have recently received a tax enquiry notice yourself, it is important not to panic. As most tax enquiries are generated by computer ‘risk profiling’, many are selected completely at random. As a result, anyone can be picked for investigation within the sector, even if you have done nothing wrong.

However, it is equally just as important that you do not ignore the enquiry letter. Responding to HMRC by their information request deadline reduces the chance of further difficulty down the line. Hence, obtaining professional advice is highly recommended.

What is a tax enquiry?

Every year, HMRC start enquiries into many thousands of personal and business tax returns and accounts to ensure the tax rules have been complied with correctly and the correct amount of tax falling due is calculated. The aim in every case is to collect more tax. HMRC has collected £26.6 billion from tax investigations in the last year.

Enquiry notices can be targeted (where HMRC have information to suspect an under-reporting of tax). Or they can be issued at random. They also implement “taskforces” to target specific industries or sectors. This partly explains why many influencers, media personalities have been in receipt of these tax enquiry notices recently. Sometimes their checks target specific sectors in which they consider as a higher risk.

£800 million has been allocated to target tax evasion, in a bid to fill the public finance black hole. Anyone who submits a tax return can come under scrutiny.

What does a tax enquiry involve?

HMRC will initially send a tax enquiry notice letter to the taxpayer. This letter provides the taxpayer with a list of information that they require and a time frame of when they need to provide it to HMRC.

HMRC then assess the information received and determines whether tax has been reported correctly. If there are any mistakes or missing entries from previously submitted tax returns, the taxpayer may be required to pay more tax (or if the error is in the taxpayer’s favour, a tax repayment is made).

However, it’s important to note that whilst HMRC may ask that you provide certain information, not everything is in their power to request.

How can the team at Starbox help you?

HMRC are within their power to issue penalties in certain circumstances and Starbox can help with reducing this exposure. Knowing what information HMRC can request is important and we can assist you with ensuring that only the appropriate level of information is provided.

We help defend our clients who have been subject to a tax enquiry. Our knowledge and experience in dealing with HMRC on such matters will provide you with the comfort that your enquiry is being dealt with in an efficient manner by a team of specialists who understand you and your business.

If you have received an enquiry letter from HMRC and would like our assistance, please contact us and a member of our team will be in touch with you as soon as possible.