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Xmas Shopping, HMRC and Big Brother Technology

Yes it’s that time of year now when we are all rushing around trying to get all those Xmas presents sorted out and wrapped up, ready for The Big Day. Oh and a quick tip when wrapping up those presents,  – just make sure you put gift/name tags on them, unlike someone I know, who last year did manage to get a couple of presents mixed up. I think it is fair to say that his brother was not really expecting to receive the item of lingerie intended for the wife. As you can imagine, it did cause a few raised eyebrows when the present was unwrapped. But I am pleased to say me and my brother are still on very good terms!

But with everyone in the Christmas shopping mood, it was a little bit unsettling this week to hear of HMRC also getting in on the act. I understand that HMRC are now using a tool called ‘Connect’ to analyse shopping data in an attempt to trap small retailers and restaurants they think are evading Tax. The ‘Connect’ system has been in operation by HMRC for just over 3 years now, but is it only recently that it has been used to track chip and pin data. It is expected that HMRC will be focusing on the spending made over the Christmas period as one of its key targets.

As there is a continued move towards a cashless society with increasing use of mobile and IT technology, I suppose we must expect HMRC to look to the use of IT technology as a powerful tool to investigate businesses.

With the ‘Connect’ system, HMRC will be using ‘Big Brother’ technology to access data from our debit and credit cards to try and track unreported income and unpaid VAT from the chip and pin data. It is widely expected that there will be a post-Christmas surge in Tax investigations. Whilst we all accept it is right that HMRC should go after the Tax evaders, it is true to say that there will also be a risk that honest Taxpayers will be caught up in this large HMRC net.

If any of you Businesses do get any unannounced, unexpected visits or contact from HMRC, then it is vital that you contact us, or your professional advisers immediately, to ensure any such situation is handled in the correct manner.

Oh just on the subject of spending at Christmas. I  got a text the other day from a friend who  had just bought a Man Utd sledge  – He said he had never gone downhill so fast in his life! I am sure all you fellow Leeds Utd supporters will love that one!

Contact me at JCL Goole Accountants if you would like to know more about the proposed use by HMRC of its ‘Connect ‘system and how it can affect small Businesses.


Rickey Cooper FFA, FMAAT, ATT

JCL – Jones Cooper Limited

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