When Inland Revenue says your business is to be audited, the most important things to remember are: be prepared and don’t panic. You may even come out of it with a tax refund.
Who gets audited?
How it works
If an audit is necessary, you’ll get a letter telling you what records Inland Revenue needs to see, with an information sheet on how the process works. Usually, Inland Revenue will follow up with a face-to-face interview to learn more about your business and answer your questions.
Some audits focus on a small part of a business. In these instances, Inland Revenue may not need to meet you and may instead choose to conduct the audit by email or through your tax agent. If you have not given consent to receiving emails, you will receive letters instead.
A basic audit will look at your business records, such as:
- payroll records
- bank statements.
More information might be looked at, depending on the nature of the audit.
How long do audits take?
Audits, like the businesses they look at, are all different. At the start of the process, Inland Revenue will give you an estimate of how long it thinks the audit will take.
Near the end of the audit, Inland Revenue will meet you again to discuss its findings. It should be clear at this point if you’ll get a refund or need to pay more tax.
The auditor will also tell you where you’ve gone wrong and how to put things right.
For more information contact the Restaurant Association Helpline on 0800 737 827 and check out RA ComplyHub for comprehensive information on all your business compliance obligations.