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| Investigation Blitz - Be prepared |
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| Tax receipts resulting from Inland Revenue compliance investigations are down from £4.5 billion in2000-2001 to £3.8 billion in 2001-2002. |
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Lower numbers of investigations, poor risk assessment and a less confrontational approach to the tax payer are the main causes. The government is unlikely to let the matter continue and so the taxpayer should expect a backlash from the local Inspectors when higher performance targets will be set.
Whilst the new, and not unwelcome sofltly softly approach to investigations will not change, the numbers of cases will most definately increase and the risk assessments modified so that those taxpayers who do underdeclare their tax will be more readily identifiable.
During 2002 less than 5 full investigations were started on the clients of this practise. The additions to the accounts that resulted in extra tax for the Revenue was negligible. We fully expect this to change.
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