
Taxes are
paid for many reasons, not only to fund the government, but also to
enable the government do something for its citizens such as to
provide better social services or benefits, improvement of
infrastructure and protective services. Paying taxes, however, is
also an issue that creates many discrepancies and disagreements
each and every year. Due to the fact that disputes are a standard
part of the tax paying process and that the majority of taxpayers
will file a dispute at some time or another, the HMRC department
was founded.
The HMRC or Her Majesty's Revenue
and Customs, was the result of merging the Inland Revenue together
with the HM customs and the Excise department. Its formation was
meant to ensure that every citizen and every employee will pay the
correct amount of taxes on time as well as receive services that
they have a right to receive from the government.
It was a
necessary move since the number of citizens finding loopholes and
thus finding ways of avoiding tax payments was increasing at an
alarming rate. Another task is that this department sorts out the
benefits that you are supposed to receive as compensation for
paying your taxes.
Since the department of HRMC was
formed mainly to take care of all the taxes that should be paid to
the government, it also has to monitor the benefits that the people
have after paying their taxes. These two functions go hand-in-hand.
The HMRC collects and administers both direct taxes and indirect
taxes from all sources and it also pays out, among other social
priorities, child benefits and watches over the child trust fund.
Any of your taxcredits
are also paid out by the HMRC each
year.
Moreover, the HRMC is responsible
for out protection through the enforcing and administering services
like border and frontier protection. It is also there in order to
keep the environment safe by handing out environment
taxes.
The
national minimum wage is strictly enforced by this department so
that all employees get a minimum income in the country. Another
function includes special favor to students by helping in the
recovery of student loans
so that every student can
concentrate on their studies and not have to worry about the
financing by receiving all the financialaid that is
available.
There are times, however, when
audits made by the HMRC raises certain tax disputes. These
enquiries can be at any point of time and can also be erratic in
their frequency and because of that many people tend to lose a lot
of money to deal with and come out of the disputes.
It can happen to anyone and even to
you. Therefore, the best thing is that you contact your local tax
consultancy services to get proper advice on how to deal with tax
enquiries and Vat disputes. You will also need advice and guidance
on IR35 and other employment status issues that you might not even
be aware of that they exist. Just make sure you ask about these and
get the right information to help you deal with various
problems.
Another way to handle any
unpleasant audits by the HMRC is to have the tax insurance. Tax
insurance is an insurance policy that will cover all of the
necessary professional fees incurred by a HMRC
enquiry.
This includes self assessment enquiries as well as disputes that are arising from VAT enquiries and employer compliance review. This can be had by any person who is submitting a HRMC self assessment return. All businesses that are VAT registered are entitled to this insurance and this should be seriously considered since the HRMC has the power to open an audit on any tax return without giving any kind of reason.
Thus, to protect yourself from any losses it is best to apply for tax insurance before anything happens as this will help you to save money which you worked so hard for.
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