HMRC target computerised tills in surprise visits on retailers

Restaurants and other retail outlets with certain types of computerised tills are being targeted by HMRC for unannounced visits to check on takings.

Unannounced visits are not particularly new for Customs and Excise, but the fact that Revenue staff are also present and that they are altering the operation of the tills to extract audit trails of entries is a new practice.

John Cassidy, Tax Investigations partner at PKF, explains that, "Whilst former Customs officers are authorised to make such visits, former Revenue officers are not. We were previously told that the Revenue would not piggy back on Customs' powers. This aggressive approach will worry many small businesses."

HMRC knows that certain types of till can be set up to suppress takings so that businesses can evade both VAT and income tax and is sending in specially trained officers to businesses using those tills to extract a full audit trail of the till entries.

This can mean that the HMRC officer has to re-programme the till to get the data they have been sent to collect.

This project, carried out in several areas in the UK, is another example of the risk-driven approach that HMRC is now taking to tax investigations. The data collected is to be analysed by HMRC's regional risk centres to identify significant discrepancies between the full records and the till rolls that businesses use to help prepare their tax returns.

John Cassidy added, "It is understandable for HMRC to sharpen up the targeting of its tax investigations but this should not be allowed to slip over into sharp practices at the taxpayer's premises.

"Law abiding businesses will be worried by these sorts of visit, especially if the business owner is not present or HMRC's handywork on the till means it has to be re-programmed. This sort of disruption of businesses is not acceptable and will make it far less likely that taxpayers will co-operate with other HMRC intervention activities."