Personal tax enquiry for director of four companies
An individual director of four companies received an HMRC personal tax enquiry notice. At the same time each company received a separate enquiry notice involving a full review of accounting and tax records – including corporation tax, income tax, VAT and PAYE.
- Supported the client’s accountant with the initial response to HMRC answering the opening information request. The client’s accountant would not have been able to handle the volume of work required to be submitted to HMRC and manage their daily tasks.
- Gave the client the comfort and support that this was a manageable task using AAB experts in each tax area.
- Allowed the director to step back and let the expert team at AAB to liaise and negotiate directly with HMRC on his behalf.
- Took over 2 years to conclude following various meetings with HMRC however no additional taxes were due.
PAYE, employee benefits and expenses review
Required a review of their PAYE, employee benefits and expenses procedures to ensure they were fully compliant with HMRC and current legislations.
- Review all current processes
- Sampling exercise of their PAYE and employee benefits and expenses records in the same format as HMRC would complete in a compliance review
- Allowed management to focus on day to day running of the business
- PAYE National Insurance issue identified for individuals who had been working overseas for a number of years. This resulted in a substantial National Insurance reclaim for both individuals and the company going back 6 years.
- £204k reclaimed from HMRC which far outweighed the cost of the review.
- Full report outlining findings and highlighted that the employee benefits and expenses had only some minor improvements suggested.
Personal tax dispute with HMRC
A private client required support in an ongoing tax dispute they were having with HMRC regarding their personal tax. During a difficult personal time for the client, they had struggled to keep up with all matters of personal finance, including the submission of Self-Assessment Tax Returns. As a result of the failure to file Self-Assessment Tax Returns, HMRC issued determinations based on estimated income and were seeking settlement of these large estimated liabilities. Still struggling, and not understanding the letters being issued by HMRC, the client settled the liabilities in good faith.
- Confirmed the determinations made by HMRC were grossly over-estimated for all years concerned
- Negotiate with HMRC using experts in private tax legislations
- Client could step-back from the tax dispute negotiations
- Despite initially stating they would not make repayments, HMRC issued the client with a tax repayment in excess of £60,000
Financial service group undertake a VAT health check
There was a requirement for a financial service group of companies to undertake a VAT health check. The companies in the group were separately VAT registered.
- Carry out a review to confirm the existing VAT structure as the most efficient
- Review the client’s partial exemption method and calculations
- Reviewed the groups AP processes to provide assurance that existing processes were robust
- Identified one business using an unapproved partial exemption special method which resulted in an excessive VAT restriction
- Submitted an error correction notification to HMRC recalculating the VAT recovery using the standard method
- Identified another business was using an incorrect VAT treatment. Then submitted an application for a non-statutory clearance to HMRC
- Secured additional recoveries doubling the previous residual recovery
VAT inspection results in penalty challenge
A business received a Notice of Assessment from HMRC following a VAT inspection. HMRC had issued a penalty of 30% of the assessment.
- Completed a full review of the assessment
- Submitted a request for an independent review of the assessment
- Sought to mitigate the level of penalty imposed by HMRC
- Allowed the business to focus on managing day to day operations
- HMRC reduced the VAT inspection penalty to 15% but following recommendations from AAB in improvements to the client’s VAT processes, HMRC suspended the penalty entirely
- HMRC reduced the assessment for the element that had been challenged
UK professional requires tax advice on Indian savings
A high-profile professional who moved to the UK to study and start a career required advice around tax on savings accounts held in India following an invitation from HMRC to clarify funds.
- A full review of her residence and domicile position
- A full disclosure of all interest using HMRC’s offshore disclosure online facility
- Significantly reduced the number years HMRC could assess
- Reduced the tax liability
- Reduced penalties – which could have been up 200% of the tax due
Norwegian Group setting up in UK outsource accounting
A Norwegian Group setting up a company in the UK with focus on developing improved technology for supporting plug and abandonment services look to outsource accounting.
- Provided outsource accounting service utilising cloud-based accounting software.
- Worked in close partnership to understand the client
- Provided support in registering with HMRC for PAYE and VAT services
- Identified Research and Development tax reliefs available
- Advising on complex VAT matters for overseas activity
- Providing Norwegian payroll compliance service for UK employees
- R&D tax relief claim was successfully made
- No internal resource was required in the UK
- Data on accounts became easily accessible online
- Client was provided with a clear understanding of requirements and compliance for UK and Norwegian tax reporting requirements
- Time saving for management in Norway
Business acquisition enables oil service company to expand
Oil services company with worldwide activities required renewal and extension of banking facilities to support organic growth and finance a business acquisition in North America.
- Supported management compile a Strategic Review of the business
- Undertook financial and taxation due diligence on target business
- Assisted with review of financial projections
- Co-ordinated audit of group and completed statutory accounts within three months of year end to meet financing timetable
- Identified key tax issues and solutions to establish an efficient group structure in place for the business acquisition
- Secured funding package for growth aspirations
- Project managed involvement of overseas auditor and tax advisors, saving time, reducing fees and meeting tight deadlines
Compliance cost saving for international company after restructure
A small but internationally focused company providing specialised drilling services to the oil and gas sector. The corporate structure was no longer serving the intended purpose, leaving the group exposed to increased compliance costs. The corporate structure had entities incorporated in three different countries, with branches in a further two countries.
- Prepared and presented a proposal to the client to restructure the group, removing one layer of the corporate structure and minimising the exposure in that country
- The limited in-house financial expertise meant AAB provided full project management, all financial accounting input, and UK tax advice
- Utilising the AAB international network we had experts in accounting, legal and tax advice in Cyprus, the Netherlands and Norway, dealing directly with those firms on behalf of the client
- Significant reduction in annual compliance requirements, with associated saving in compliance costs in the region of $40,000 per year
- Reduced administrative burden, freeing up finance staff to do more valuable activities
- A more appropriate structure with reduced tax exposure across the group
Corporate tax appeal for labour supplier in Norway
A specialist labour supplier required corporate tax advice and support in order to resolve an issue with unexpected Norwegian corporate tax.
- Reviewed the contract between our client and the multinational to fully understand the work performed by our client
- Contacted customers of the client to request an amendment confirming that this was a labour hire agreement
- Supported our client with subsequent correspondence with the Norwegian Tax Authorities including project managing the appeal
- The appeal was successful
- The charge to Norwegian corporate tax was removed, which would have represented an incremental and unexpected cost to the company
- Advised the client to, in future, challenge their customers’ generic contractual clauses to ensure that future contracts reflect the fact that they are a supplier of specialist labour
- Assisted with future reporting of contracts to the Norwegian Tax Authorities to ensure that no charge to Norwegian CT would arise in the future