HM Revenue and Customs (HMRC) has said that this month it will target as many as 50,000 businesses that have failed to submit VAT returns, with warnings that their tax affairs will be closely scrutinised.
More than 600,000 businesses have to submit VAT returns each month and although the majority of companies do so on time, in a new campaign, HMRC is warning that from 28 February tax affairs will attract greater attention.
The VAT Outstanding Return campaign is aimed at businesses that have one or more VAT return outstanding and have been told to submit their returns, but have failed to do so.
It has been revealed that these businesses will have until 28 February to pay the tax they owe, but if the payment is not made by this date then the HMRC has stated that it will target them and take a much closer look at their tax affairs.
By using this campaign to come forward voluntarily, they might receive better terms, as any penalty they pay may be lower than if HMRC comes to them first.
Marian Wilson, Head of HMRC Campaigns, said:
“If HMRC has sent you a VAT return and you have not yet taken any action, this campaign is a reminder to bring your tax affairs up to date. But time is running out.
“After 28 February, if they have not submitted their outstanding VAT returns and paid what they owe, HMRC will use its legal powers to pursue outstanding returns and any VAT that is unpaid. Penalties, or even criminal investigation, could follow. “
The HMRC says that people can take part in the campaign by either completing or paying any outstanding VAT returns immediately, or alternatively inform HMRC if they have stopped trading or have changed their business details.