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HMRC internal manual

VAT Small and Medium Enterprises Assurance Manual

From
HM Revenue & Customs
Updated
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Post Audit Action: Issue and receipt of references: VAT 452

(Priority) reference should be used to bring to the attention of the receiving risk team:

  • potential irregularities in the method of accounting for VAT by a trader. For example: information, verbal or written, obtained during a visit to a trader belonging to the issuing office, may give the visiting officer strong reasons for believing that VAT is being incorrectly accounted for;
  • request verification of details of transactions extracted from a trader’s records, for the benefit of the issuing office; and
  • request in cases of suspicion, details of transactions between traders over a specified period of time. Routine requests for such details are not to be made.

VAT 452s should, therefore, be used when significant amounts of tax are believed to beat risk, sufficient at least to justify generating a visit, to prevent attacks on the VATsystem or when information is urgently required by the issuing office, or before a visit,or fraud enquiry can be brought to a satisfactory conclusion.

It should be borne in mind that excessive use of urgent references will undervalue theiroverall effectiveness and impose an unnecessary burden on the sift system, but withouttheir regular use we could not assure traders’ accounting systems. Before issuing apriority reference a preliminary “VISION” or DTR check should be considered.

When a reference on VAT 452 is issued the officer should record the fact in the auditreport.