Revenue Audit in June.

BrowmThomas

Got notification today that I have been selected for a revenue audit next month. I have a small business - take in a very small amount of cash but all recorded and documented.

Anybody care to share what inspectors will ask or want from me??

Also how much do accountants charge to prepare files? Mine is to come back to me on Monday with that.

Thanks.

JMR

You don't say if this is a personal or company audit or both.
Either way, the notification letter from revenue should have included a list of items that they will expect you to provide for the year(s) under audit. These will include but may not be limited to the following.

• P60's
• Deposit Interest Certificates
• Bank statements (personal and company)
• Details of any rental income

myshirt

First thing to do is to write back to them and ask that it be postponed to allow your advisors to review.

dbran

BrowmThomas wrote: »

Got notification today that I have been selected for a revenue audit next month. I have a small business - take in a very small amount of cash but all recorded and documented.

Anybody care to share what inspectors will ask or want from me??

Also how much do accountants charge to prepare files? Mine is to come back to me on Monday with that.

Thanks.

First thing is that most revenue audits are not random but are for a reason. This may be because there is something in the submissions that you have made that have come to the revenue's attention. Or it may be that you are in a certain type of business that the revenue has found in the past to be a source of tax evasion.

If you are aware of any tax issues that you or the company may have, you will need to consult with your accountant/tax advisor as to whether you should make a voluntary disclosure if appropriate.

Best of luck with it.

dbran

ebbsy

myshirt wrote: »

First thing to do is to write back to them and ask that it be postponed to allow your advisors to review.

+1

Although usually the advisor should do this.

Sometimes its just a Vat or Paye audit. Which one is it OP ???

Revenue are used to dealing with advisors, as opposed to the business themselves.

BrowmThomas

Thanks all.
It is for both company and personal.
JMR, there was no list at the end of the letter.
Genuinely, there are no issues, very small business, perhaps they think I am under declaring but that is not the case. I can get p-60 and statements etc but I'm useless at all that side of things - hence my accountant!!
It's an extra expense that I really can't afford at the moment. I do comply with everything I am aware that I need to do.
Sometimes I question if being self employed is worth it.

myshirt

If you think it's an expense you could do without, imagine feeling the pinch of the cost from not addressing it. That's the unfortunate thing with these issues.

Quite important you kill it off. Good quality professional advice and guidance is generally bang for buck here, it really is.

collegeme

Are you VAT registered?
Are you registered as an empolyer?
I presume you have a Ltd company?
Why did you choose Ltd company over sole trader if applicable?

JMR

BrowmThomas wrote: »

Thanks all.
It is for both company and personal.
JMR, there was no list at the end of the letter.
Genuinely, there are no issues, very small business, perhaps they think I am under declaring but that is not the case. I can get p-60 and statements etc but I'm useless at all that side of things - hence my accountant!!
It's an extra expense that I really can't afford at the moment. I do comply with everything I am aware that I need to do.
Sometimes I question if being self employed is worth it.

Hopefully your accountant has provided some clarity for you by now.
These days the Revenue use a pretty sophisticated profiling database called REAP to select companies for audit.
This means that if you are selected for audit it is very likely that there is a problem. You have not been merely selected at random I'm afraid.

As another poster suggested, your initial response to Revenue may be to request an extension (60 days) in order to prepare all documents that they require. This is fairly standard.

Best of luck with it

delahuntv

dbran wrote: »

First thing is that most revenue audits are not random but are for a reason.

Many are randon when revenue are checking a particular industry.


I've had 2 audits over 20 years - once you are honest and not hiding anything, they are straight forward and easy.

Audits are both to check that you are paying and also to see what your systems of record are like and the revenue offical will give advice if they think improvements can be made.

They may query a few invoices and they will give you time to provide answers.

example would be an invoice without a vat number.

JMR

delahuntv wrote: »

Many are randon when revenue are checking a particular industry.

Not these days.
Within a target industry, Revenue use their REAP system to audit the companies that have raised flags.
Those that have not raised any flags do not get audited, generally speaking.

collegeme

Random audits would be a waste of time and money.

That's not to say that if you are selected that you have something to hide, but they are far from random.

I have dealt with clients on a few revenue audits so am somewhat familiar with the process.

BrowmThomas

Thanks for all your replies - sorry for not getting back sooner.

I closed a company and opened a new one. I do take in some cash but have ALL of that recorded and fully accounted for. Don't take a big income but that's the nature of the business.

Accountant doesn't feel there is a need to get an extension as all seems fine. Their fees are €2k - annoying when not budgeted for but can't be helped unfortunately.

BrowmThomas

@ collegeme not vat registered - not necessary. Am registered as an employer and Ltd company as accountant advised that was best route.

Genuinely comply with their requirements - won't mention what I do but it is something that I wouldn't be able to get away with fiddling the books.

Hopefully they will see that when the time comes.

JMR

BrowmThomas wrote: »

Their fees are €2k

Fees for what??
Standard annual fee for preparing your end of year accounts etc or an additional fee for assisting you through the audit process?

If it's the latter, it seems pretty excessive in my opinion

pedroeibar1

collegeme wrote: »

I have dealt with clients on a few revenue audits so am somewhat familiar with the process.

Just to know that we are on page here ---- are you a qualified accountant? What body?

BrowmThomas

JMR wrote: »

Fees for what??
Standard annual fee for preparing your end of year accounts etc or an additional fee for assisting you through the audit process?

If it's the latter, it seems pretty excessive in my opinion

Fee is to prepare and get the files ready for inspection and have the accountant with me while audit takes place. The accountant does annual returns etc. That was why I asked initially how much they cost - just seems a lot.

collegeme

pedroeibar1 wrote: »

Just to know that we are on page here ---- are you a qualified accountant? What body?

ICAI

collegeme

BROWMTHOMAS. It doesn't seem like anything to worry about, it could have been the closing of one company and opening of another . Fees do seem high but we don't know the amount of information involved.
Best of luck.

JMR

BrowmThomas wrote: »

Fee is to prepare and get the files ready for inspection and have the accountant with me while audit takes place. The accountant does annual returns etc. That was why I asked initially how much they cost - just seems a lot.

The bulk of this fee must be for the accountants time on the day of audit as you mentioned previously that the company is a "very small business".

I would firstly ask either your accountant or Revenue directly for a list of documents that the auditor will require access to. It is entirely possible that you can gather / print this info yourself.

I would then contact Revenue directly, the contact details of the auditor dealing with your case will be on the notice letter sent to you. I would ask the auditor exactly what is required during the audit and if your accountant needs to be present. You might get the feeling from him / her that they are looking at a very specific area which can be addressed directly by yourself and you need not be burdened with your accountants daily rate.

I would seriously urge you to talk to the auditor directly, Revenue can be extremely helpful and knowledgeable and it could save you money!

Best of luck with it

BrowmThomas

Thanks JMR.

I'm so bad with that side of things - hence why I outsource.

I didn't realise I could do any of those things so will definitely look into it - thanks for the information.

It has taught me that I need to do a course/s to get more aware of what I can do myself to reduce accountant fees going forward. Better in my pocket :-)

dbran

Perhaps.

But you should also bear in mind that they are not coming out for an awl chat about the horses and the weather. They may be friendly and professional but the bottom line is that they are there to do a job and that is to audit you. To see if there are any errors or omissions and then if applicable to apply the relevant interest and penalties. If you are unlucky to get a less benign inspector you may be in for an entertaining day.

They are not there to provide you with tax advise. They are not your friend. There are many occasions where I have had to rescue a situation where the client has shot their mouth off in front of the inspector.

If you are confident enough about the financial affairs of your business then you may consider speaking directly with the auditor with due caution. If not then this is best left to your accountant who will certainly earn his/her corn here.

The fee is presumably based on the level of time required and the level and knowledge of staff involved. If your case is as straghtfoward as you say then perhaps a less senior person may be necessary. Perhaps ask and see if this is appropriate.

dbran

BrowmThomas

Thanks dbran
My accountant keeps telling me to give one word answers and not to say anymore! I waffle when I'm nervous so that could be fun!!
I would have to have someone there with me - I wouldn't be happy or confident I know enough about taxes and payroll to explain any questions myself. For the sake of it, I would prefer to have a professional with me.
Think its one of the senior staff who will take my case. I have always sent on any information they requested, pay on time and can backup all income and expenditure so am hoping there is nothing that can be found.
I have asked how long it should take, I would need to bring in extra staff if it takes any length - maybe it just depends on individual cases.
Am trying not to stress but will be happier when it is over!

westcoast66

What time period does the audit cover?

BrowmThomas

2012 and 2013.

pedronomix

Revenue profiling also throws up erroneous audit targets!! A very close friend, a senior bank executive with a decent ivestment portfolio of shares and property, was selected fot a multi-year audit last summer. He is also a chartered accountant and meticulous in his detail in all matters financial and Revenue. He got the letter, they wanted to meet at his place of business, but he was a bank salaryman primarily, so he met them in a quite corridor in HQ..... They soon realised their mistake and vacated the premises. Most likely, as you have aleady identified your small scale, they just want to put their fingers in the wounds!!

BrowmThomas

That made me laugh, I honestly cannot understand how or why I was picked. Sadly I do not have millions hidden away or live an extravagant lifestyle.

whelan2

i was able to claim accoutants fees on my insurance-minus the vat-when i had an audit, i dont see why you need an extension, imo it only more time to be worrying about what they want, best of luck with it

BrowmThomas

Thanks for that - will look into it.
Don't have any need for an extension to be honest, all seems to be working out.
I would prefer to have it over now.

jarvis

@brown Thomas. Have you had this ausury yet? How did you find it?

BrowmThomas

Hi Jarvis,

I have gone back through my records and sent on anything (receipts) extra that I found. My accountant has staff doing exams at the moment so they are a bit slow getting back to me but all seems ok on both sides. I have to be available the week before for any questions that may arise.

It's not until June 3rd. I want it to be over!!

Will report back when it is over.

relax carry on

BrowmThomas wrote: »

Hi Jarvis,

I have gone back through my records and sent on anything (receipts) extra that I found. My accountant has staff doing exams at the moment so they are a bit slow getting back to me but all seems ok on both sides. I have to be available the week before for any questions that may arise.

It's not until June 3rd. I want it to be over!!

Will report back when it is over.

At least you are preparing for it. The last thing an auditor wants to see is someone who hasn't bothered to prepare. Just ensure your records are in order and all original supporting documentation is available on the day to back up your returns. Any anomalies or errors discovered should be included in a valid disclosure on the day.

BrowmThomas

Think everything is ready - will know for sure next week ��

BattleReady

Good Luck with it. Nerve racking stuff. I went through it myself about 3 years ago.

BrowmThomas

Thanks BattleReady, dreading it but will be over by this time next week!!

Does it take long for them to get back to you - am sure there is nothing they can find that is owed to them but just don't know what they pick up on.

BattleReady

They were fairly nice during the audit, but I was shaking like a leaf offering them tea and biscuits.

thought that was it, but they asked for a lot of followup information and took over a month for them to finally send out a letter to say the audit had been closed.

You'll be ok once your accountant has gone through everything and he/says you are good.

it's still a relief to get that letter though

BrowmThomas

A month �� I didn't think it would take that length!!!

My accountant warned me to give yes no answers and not to be nice - that's not me, I'm just not like that.

Here's hoping all will be sorted in a month so!

BattleReady

BrowmThomas wrote:

My accountant warned me to give yes no answers and not to be nice - that's not me, I'm just not like that.

BrowmThomas wrote:

A month I didn't think it would take that length!!!

BrowmThomas wrote:

Here's hoping all will be sorted in a month so!

Got exactly the same advice, it's very hard to do though, I was the same.

It might not take that long if they are happy with everything.

BrowmThomas

Fingers crossed.

It's good to know that others have been through it - and that it wasn't THAT bad.

Things have really picked up since I got the letter aswell!

BrowmThomas

So its over ��
Seemed to go ok - could answer everything and was told they will contact me in due course....hoping that's a good sign!!

dbran

BrowmThomas wrote: »

So its over ��
Seemed to go ok - could answer everything and was told they will contact me in due course....hoping that's a good sign!!

Yep. I think you would be having quite a different conversation if there was something amiss.

Best Regards


Dbran

BrowmThomas

Thanks Dbran - it was over in an hour but I won't relax until I get the reply. It's a huge weight off me.

Thanks :-)

BattleReady

Glad to hear it went well. Good luck with it all

JMR

BrowmThomas wrote: »

Thanks Dbran - it was over in an hour but I won't relax until I get the reply. It's a huge weight off me.

Thanks :-)

Great stuff, well done!

BrowmThomas

Thanks JMR - and thanks for your advice too :-)

Spanish Eyes

Random audits DO happen.

It is a sort of control measure against the targeted REAP audits.

It would be ridiculous if REAP was the only method really. People can file on time, have regular and similar income and so on. So they would not appear on REAP

But some could be hiding something!

Randoms are there for a reason.

jcon1913

Spanish Eyes wrote: »

Random audits DO happen.

It is a sort of control measure against the targeted REAP audits.

It would be ridiculous if REAP was the only method really. People can file on time, have regular and similar income and so on. So they would not appear on REAP

But some could be hiding something!

Randoms are there for a reason.

Do you have a source for this opinion?

relax carry on

jcon1913 wrote: »

Do you have a source for this opinion?

Its in the code of practice.

http://www.revenue.ie/en/practitioner/code-of-practice-revenue-audit.pdf

The objectives of the Random Audit Programme are to measure and track compliance with tax legislation, to act as an indicator of the effectiveness of Revenue’s risk based approachand to provide for the possibility that all taxpayers may be selected for a Revenue Audit.

dbran

Hi

They do happen but are only about 5% of the total audits carried out by revenue. So you could be very unlucky and be part of the 5% or more likely you have sent in something that has come to revenues attention.

dbran

jcon1913

dbran wrote: »

Hi

They do happen but are only about 5% of the total audits carried out by revenue. So you could be very unlucky and be part of the 5% or more likely you have sent in something that has come to revenues attention.

dbran

Yes thats the Code of Practice, have you ever seen a random audit?

_Tombstone_

jcon1913 wrote: »

Yes thats the Code of Practice, have you ever seen a random audit?

awkward much?