Starting from August 2019, all regular TaxOne customers (subscribing to or currently using other TaxOne services) will be able to insure themselves against tax investigations related expenditure.
This insurance is called Tax Investigation Insurance and is provided by Croner Taxwise. Croner Taxwise is a leader in the Tax Investigation Insurance market in the United Kingdom. Its services are used by more than 4,000 accounting firms throughout the UK, and the company's clients rate it at 4.9 / out of 5 on the independent review website feefo.
HMRC has more and more opportunities to carry out tax inspections and is more and more willing to use them. The new Making Tax Digital initiative will make it even easier.
Regardless of how well your business accounting is done, an inspection from the taxman is a stressful event. The inspectors often appear with little advance warning and the whole process requires a lot of additional administrative and accounting work. In small businesses the biggest burden often falls on the owners themselves, pulled away from doing what they know how to do best, i.e. running the business.
Restaurants, fast-food outlets, shops and construction companies are often the subject of HMRC investigations, and if you operate such a company, Tax Investigation Insurance is especially worth buying.
The fees for routine accounting services (subscription) do not include the costs of handling HMRC inspections. These costs typically amount to several hundred to several thousand pounds for small and medium-sized companies.
You have done nothing wrong? Tax Investigation Insurance is designed precisely for the companies that "did nothing wrong". Many companies are randomly selected for inspection, and the inspectors uncover no irregularities.
Tax Investigation Insurance covers the costs of professional accounting services incurred in the case of inquiries, interventions, inspections, visits and disputes with HMRC. It comprehensively covers the costs invoiced by the accountants for all work related to HMRC inspections their clients are subject to.
Neither the amounts of taxes, interest and fines, nor current accounting services, such as the preparation of tax returns and financial statements, are covered by the insurance.
Even if your business is not subject to a HMRC inspection, you can take advantage of advice offered by professional Croner Taxwise consultants. All companies covered by the insurance have access to telephone helpline regarding:
Insurance costs will depend on your company's business profile and annual turnover, but are not high compared to the costs incurred in case of investigations. You will receive information about costs for your company directly, as well as the policy documents. The maximum amount for one claim is £ 100,000.
The Tax Investigation Insurance provided by Croner Taxwise is available only through tax adviser/accounting offices. I have managed to negotiate favorable prices with the provider, and I offer them to my clients at cost. If you are not a TaxOne customer, ask your accountant if they provide such insurance ... or check our services.