Munster’s first independent VAT consultancy practice providing specialist VAT and Indirect tax advisory, assurance and interim management support services to owner managed businesses, small & medium enterprises, accountants and legal practices.

Revenue audits, better to be prepared

Sunday, October 11, 2009

by Nick Ryan

Without reminding you of the current difficult times all businesses are now experiencing, Revenue audits can still provide for a stressful and traumatic experience if not managed with the due care and attention required.

With the tax yields falling there is greater pressure on Revenue to collect, collect, collect. Associated with this. cost containment, and preferable reduction, is a key element of any businesses’ strategy for survival. With cost containment/reduction there is the potential to shortcut on obligations in the management of a businesses’ tax burden which can result in a business either paying too much or in failing to be fully compliant. Failure to comply in meeting your tax obligations can result in a heavy price both in underpaid taxes, and the associated penalties and interest, the increase in business costs in both dealing with the error(s) and, in rectifying matters.

Control on both sides of the fence is becoming a mantra, how much focus to attention is applied to this by a business will determine how smoothly and efficiently they deal with a Revenue audit.

The key factor in managing a Revenue audit is being prepared whether a business has been selected or not. If the management of a businesses’ VAT, and other tax, accounting and reporting obligations are correctly maintained and abreast of any changes in legislation then it is less likely that a Revenue audit will identify errors which could result in a negative cost to the business. Where these control and management functions have been neglected then the repercussions could be fatal to a business in these times where cash flow can be so precarious.

The VAT Practice is aware that businesses can not open the door for full on reviews and health checks “just to see” if there is a problem but through risk analysis and open discussions with a business we can assist a business in identifying where potential weaknesses may lie and what, if any, the associated potential cost may be if that weakness exists. Like in other walks in life, is there little venture in trying to remedy the past when greater reward can be achieved by taking measures that impact on how we manage now and for the future. To focus on the now can lead to a better future.

If you have concerns on your businesses’ VAT accounting and reporting systems, have been identified by Revenue for an audit or are currently undergoing a Revenue audit then please contact the VAT Practice for a no obligation discussion.

Any comments you have about your experiences with dealing with Revenue audits, management of your VAT reporting obligations and on this entry are appreciated and welcomed. Please submit these in the add a comment link below or, alternatively please contact us.