How likely is it that your business will win a HMRC tax appeal?

How likely is it that your business will win a HMRC tax appeal?

Not very, according to accountancy firm Wolters Kluwer.

Apparently, there is actually only around a 25% chance that a business tax appeal will be successful; 75% are unsuccessful, based on Government figures.

HMRC the Revenue received 7,081 appeals in the tax year 2013-2014; 6,626 were settled. Out of the outstanding 455 appeals, only 113 were granted.

VAT expert for Wolter Kluwer UK, Glyn Edwards, said that accountants should warn clients of the difficulties appealing a HMRC decision;

“If you have a client that disagrees with an HMRC decision you need to make them aware of how difficult it is to win a case at tribunal.

“As the statistics show, only a few hundred appeals get to tribunal and those that do are more likely to be won by HMRC than the taxpayer.”

He went on to explain that accountants should always advise clients by helping with thorough research on relevant legislation, helping them with preparation for hearings and making sure that all of HMRC’s documentation is in place well in advance of any hearing.

In addition, it was recommended that clients should consider using HMRC’s alternative dispute resolution service in a bid to negotiate settlement.

Edwards went on to say;

“Clients shouldn’t be spending more time and money than the tax in dispute reserves, as they can’t claim costs even if they win in the first-tier tribunal.

“However, if an accountant feels the client has a strong case then it is certainly worth making an appeal, but only if the client has expert help, as those who represent themselves are more likely to lose.”

Of course, the above should be common sense, but can you be sure that your accountant would help you in this capacity if you found your business in this situation?

At Omni Chartered Accountants, we strongly believe that remaining in contact with our clients and guiding them along their business journey is the key to not getting into tax disputes with HMRC in the first place.

However, our bespoke, one-to-one service means that we are there whenever our clients need us and are proud of our first class service and competitive fee structure.

For more information about Omni Chartered Accountants, call 01902 837 408, or request a free of charge call back from our website www.taxandaccountancysolutions.co.uk – we are always happy to help.