HMRC employer compliance reviews

Employer compliance reviews are the most common form of HMRC enquiry.  With advice from WMT’s employment specialists, you can limit the distraction and inconvenience of a review whilst minimising the cost to your business.

Compliance reviews seek out unpaid taxes and National Insurance Contributions (NICs) on pay and benefits. If your business is subject to a compliance review, you will be required to make a financial settlement to cover underpayments and penalties.

Whatever the outcome of the enquiry, you will have to cover the cost of preparing for the review, meeting with the inspectors and responding to their queries, as well as any fees for professional advice.

Employer compliance reviews are usually triggered by an apparent discrepancy on a tax form, in a business’s accounts or on personal tax returns. These are easy mistakes to avoid if your PAYE and National Insurance schemes are fully compliant.

HMRC also carries out ‘spot check’ compliance reviews on a random sample of employers. These are designed to root out businesses that are purposefully avoiding tax and NICs, but many innocent employers are also investigated.

Whatever the reason for the review or the amount of underpaid tax in question, it will be carried out by tax inspectors and cover your systems and processes for:

• Payroll and the operation of PAYE and National Insurance
• Expenses and reimbursement procedures
• Benefits in kind and non-cash remuneration
• Employment status
• National Minimum/Living Wage
• Statutory payments such as sick pay, paternity and maternity pay
• One-off issues such as termination or redundancy payments
• IR35 (personal service companies)
• Construction Industry Scheme (if relevant)
• Expatriate and inpatriate workers
• Distribution of tips, service charges and gratuities in the hospitality sector

How we help

Reviews must be handled properly from the start to achieve the best possible outcome. Employment specialists at WMT will support you before, during and after a compliance review, relieving you from the pressure of the investigation and managing its costs.  Best of all, we can advise you on how to avoid them in the first place.

Keep you compliant – by managing your payroll for you or carrying out an employer healthcheck on your processes so that you are unlikely to become the target of an employer compliance review.

Manage your review from beginning to end – preparing documents, accompanying you to meetings with the investigators, responding to HMRC queries and preventing the scope of the review from creeping into non-employment matters.

Negotiate a favourable settlement – on demands for unpaid tax by reviewing HMRCs calculations and defending your position.

Agree staged payment terms with HMRC – where unpaid tax is due, to protect your cashflow.

Shield you from the cost of seeking the right advice – with our fee protection insurance.

Our experts include former Inland Revenue/HMRC Inspectors who have previously conducted enquiries, so we can offer you the practical advice and support you need to allow you to concentrate on running your business.

Get in touch with our employment services team to find out more about how they can help you.