What’s involved? Currently, BRCs involve an HMRC officer coming to your place of business, by appointment, to check that your bookkeeping procedures are sufficient to ensure your accounts and tax returns are correct.
New approach. HMRC states that the new procedure will mean, before deciding to make a BRC, it “will evaluate new risk processes and ensure new approaches are cost-effective and fit with its wider compliance activity”. In plain English, that means instead of jumping the gun and wasting everyone’s time it will make better preliminary enquiries, usually by phone, to see if record-keeping benchmarks have been met.
Benchmarks. HMRC hasn’t said what the benchmarks are, but reading between the lines, and based on reports from subscribers, HMRC is less likely to get involved where your accountant is happy with your record keeping. This applies right across the country, not just in the those areas mentioned above.
Tip 1. Ask your accountant what, if anything, you need to do to improve your record keeping. Not only will this help protect you against a possible BRC but in the long run it might reduce your accountancy bill.
Tip 2. HMRC might agree not to carry out a BRC where someone from your business is prepared to watch a webinar and take advice on record keeping from its Business Education and Support Team (BEST) (see The next step ). On balance, this is probably the lesser of two evils.
For more information on BRCs and BEST, contact us using the box below.
PS, We have been advised that HMRC might not bother with a records check if your accountant has given you a clean bill of health. It might also forgo a visit if you’re prepared to watch a webinar on record keeping.