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HMRC internal manual

Compliance Handbook

How to do a compliance check: records: introduction

FA08/SCH37 began the alignment of record-keeping requirements for

  • income tax
  • capital gains tax
  • corporation tax
  • direct taxes claims not included in a return, and
  • VAT.

FA09/SCH50, which took effect from 1 April 2010, amended existing legislation to align the record-keeping rules for

  • aggregates levy
  • climate change levy
  • landfill tax,
  • insurance premium tax and
  • stamp duty land tax.

F(no3)A10/SCH13, which from 1 April 2011, amends existing legislation in CEMA79/S118A to align the record-keeping rules for revenue traders. These changes affect the following duties:

  • Tobacco Products Duty
  • Alcoholic Liquor Duties
  • Hydrocarbon Oil Duties
  • Betting and Gaming Duties
  • Air Passenger Duty.

The changes allow HMRC to

  • make regulations to specify the records and supporting documents that either must or need not be kept
  • reduce the period for which records must be kept in individual cases, and
  • specify conditions and exceptions to the general rule that information instead of records may be preserved.

HMRC regards good record-keeping as essential because records underpin accurate notification and return of tax/duty liabilities and accurate claims. Research shows that poor record-keeping is a key factor in many incorrect returns.

Action to deal with non-compliance with record-keeping requirements is essential. Penalties should be used in appropriate circumstances to improve compliance. There is no change to the existing penalty regimes.