Small firms are being urged to consider insuring themselves so that they can fight unfair tax demands.
The call comes from Robin Milnes, who runs TaxAssist Accountants in Sheffield, in the wake of a VAT tribunal ruling, which saved the owner of a farmhouse bed and breakfast business from paying VAT, after HM Revenue and Customs failed to prove it ought to be lumped in with the farm, which was a separate VAT-registered business.
“Costs cannot be recovered from HMRC, even after an appeal has been won, so fee protection insurance is vital,” says Mr Milnes.
“Without it, it’s unlikely that this latest case would have been defended. With it, businesses can fight their corner, knowing that all the legal costs are met.”
Mr Milnes says HM Revenue and Customs is continuing to target small stand-alone businesses.
“Sheffield small business owners need to protect their legitimate and hard-earned income,” he adds.