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What right does HMRC have to search my business premises?

Since 1 April 2009, the Revenue can enter business premises to inspect the premises themselves, together with business assets and business documents kept there. The Revenue may remove any documents, record information (electronically or otherwise) and put marks on assets to show they have been inspected.

 There are three ways that the Revenue may legally enter the premises:

  • with the permission of the occupier. The Revenue does not have to give any notice and agreement does not have to be sought in writing – it could just be oral. For example, a tax officer could phone you or knock on the door and, if you agree to the inspection, it can take place there and then
  • at any reasonable time if the Revenue gives you seven days’ notice. This does not have to be written notice
  • at any reasonable time if the inspection has been by an appropriate Revenue officer or approved by the First-Tier Tribunal. In this case, you must be given written notice but the amount of notice could be more or less than seven days.

 You have the right of appeal against the inspection to the First-Tier Tribunal but only if you have been given written notice. If the inspection has been approved by the First-Tier Tribunal (which will be stated on the written notice), obstructing the inspection can result in a fine of £300 and, if the obstruction persists, up to £60 a day. These penalties do not apply if the inspection was not approved by the First-Tier Tribunal, but the Revenue will then undoubtedly seek approval and return, so you may just be delaying the inevitable. If the Revenue believes tax is being lost, it can apply to the Upper Tribunal (see later in this chapter) to impose a tax-related penalty as well.

If you work from home, the Revenue can inspect those parts of your home used for business, but not the purely private parts of your dwelling.

This was taken from the What Investment Guide to Personal Tax by Sara Williams and Oliver Haill which can be downloaded as an e-book from here.

A PDF version of the book can be purchased by contacting Samantha Coles on 020 7250 7039 or samantha.coles@vitessemedia.co.uk”