There are very few expert witnesses able to offer our high levels of experience and training from both within HM Revenue and Customs and private practice. Our credentials are unsurpassed in the field of tax disputes. We are also able to provide expert witness support in non-tax areas such as financial work in divorce cases or employee fraud cases.
HM Revenue & Customs were seeking to confiscate £350,000 cash seized from a client who had a cash-generative business who HM Revenue & Customs alleged had failed to declare all his business income. The cash had been seized in a raid on the client's home and HM Revenue & Customs were alleging criminal conduct and seeking to confiscate all of the cash. The client maintained that whilst a proportion of the cash was from undeclared income, the bulk of it was from non-taxable sources.
In support of its position, HM Revenue & Customs relied upon an internal HM Revenue & Customs forensic accountant's reconstruction of business results that showed undeclared takings of £600,000. We were instructed by the client's solicitor to review the HM Revenue & Customs report, identify any inaccuracies in the report and to comment upon our findings under cross examination in Court during the Proceeds of Crime Act hearing. Our review indicated that the HM Revenue & Customs report relied upon flawed and untested data, ignored the actual circumstances and facts. Furthermore, the methodology employed in the report did not accord with HM Revenue & Customs own instruction for the reconstruction of business results.
To produce more reliable findings, we undertook a business records reconstruction using HM Revenue & Customs approved methods (which HM Revenue & Customs had failed to do) and produced more reliable results by reviewing current transactions and projecting the results back into earlier periods. Our research indicated that the undeclared income was £100,000 rather than the £600,000 suggested by HM Revenue & Customs.
We were cross-examined in court and were able to successfully advocate that the results we had produced were more reliable than HM Revenue & Customs results, as they were based upon accurate data and had been arrived at using HM Revenue & Customs own investigative techniques.
At the end of the hearing we were praised by the Judge for the high quality of our work, and the Judge agreed that our findings were correct and should displace HM Revenue & Customs results.
The outcome of the case was that the Judge instructed HM Revenue & Customs to repay £200,000 to our client as a result of our work.
This case study shows the value of an awareness of HM Revenue & Customs procedures and an instinct for the best way to tackle a challenging assignment.
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