Careless or deliberate inaccuracies that lead to an understatement of tax can result in a penalty being charged by HMRC. This penalty is expressed as a percentage of the potential lost revenue and can be as much as 100- of the lost revenue for deliberate and concealed actions.If you discover an error in your VAT records and you have completed the return for the period in which the error has been discovered, it is advisable to take the correct action to amend as soon as possible. Unprompted disclosures may lead to a reduction in the penalty on the basis on the â€˜quality' of the disclosure i.e. the accuracy of the disclosure made and a willingness to be â€˜transparent' and provide HMRC with any information they require. The amount of the net error can determine the method of disclosure so if you are unsure of what steps to take, please seek advice to ensure you approach matters of this nature in the right way.Managing the disclosure process can be tricky but efficient and timely responses can heavily reduce penalties incurred, in some instances eliminating them entirely. If you require help in reducing a penalty, navigated the disclosure process efficiently or require advice on avoiding penalties in the first instance, please contact our free helpline where we can assist you on all matters.
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