Despite popular opinion that some large companies ought to be targeted for their blatant tax avoidance, it appears that small business owners are more likely to be brought under the microscope. HMRC can opt to instigate criminal or civil investigations and the way in which business owners react initially often determines the way proceedings are handled. As a result, it is essential that expert advice is taken immediately.
This expert advice would normally be sought from an accountant but the cost of defence can be extremely expensive. An investigation can be targeted or random and it is up to the business owner to prove their innocence. It is not uncommon for investigations to last for longer than a year and to cost several thousands of pounds in accountancy fees. This is without any additional tax that may be found owing.
Insurance to pay accountancy fees in such circumstances is available but is costly because of both the volume of investigations and their length. Basically, on your own, you are a bad risk
Members of Your Business Community (YBC) enjoy this protection as part of their membership and by joining you will become a good risk relatively speaking.
We insure our cars and houses as routine so, for many, it is prudent to insure our businesses too.