Sarah Mawson and Varoon Saccaram explain what hospitality and retail businesses receiving an HMRC ESS nudge letter need to do next. Just don’t ignore it…
Past attempts to tackle users of electronic sales suppression (ESS) tools have been relatively ineffective but HRMC has recently assigned its Fraud Investigation Service to the task of challenging suspected users. This article explains what this means for implicated traders in the hospitality and retail sectors – and what to do next. Within the four walls at HMRC, it has been an old adage that “a prevalence of cash usually equates to a fruitful tax enquiry”. Consequently, businesses operating in hospitality and retail sectors have traditionally been subject to more than their fair share of investigations. Even today, despite the use of ‘physical cash ’becoming sparser, the spotlight still remains on these sectors. This is largely due to HMRC’s discovery of ESS tools being used to manipulate sales records and artificially suppress tax liabilities.
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