Tax crackdown on mileage claims could lead to six-figure fines
That's the warning from business mileage audit firm The Miles Consultancy (TMC), which says that it's open season on unaudited mileage.
The company adds that it has come across five on-going cases in the last four months. More than £2,000,000 in back taxes and fines could be at stake in total for those five businesses alone.
TMC says that it is not difficult for local inspectors to check firms’ records. If they find gaps or anomalies, business could potentially face a huge fine as well as having to pay the back-tax.
Paul Jackson, managing director of TMC, said: 'We have evidence of inspectors going to extraordinary lengths to uncover false or missing reports.'
Mr Jackson continued: 'Businesses need to be aware that HMRC is now very closely focused on the way they record and check mileage claims. They can expect to be challenged over any errors or omissions in their records that might have led, even inadvertently, to underpayments of tax on cars or fuel.
'Businesses need to realise that mileage recording by itself is only half the battle. Unless you also audit your data you're simply ensuring that your business is an obvious target as far as HMRC are concerned. Whatever you unwittingly pay for phantom business miles will double if the taxman comes along and decides to audit your records for you,' concluded Mr Jackson.