A Fresh approach to Business Records Checks (BRC’s)

HMRC has now announced that BRCs will be re-launched from 1 November 2012.

A pilot programme of Business Records Checks began in April 2011.  This involved checks by HMRC on the adequacy of SME statutory business records. SME’s are defined as businesses with an annual turnover below £30 million who employ less than 250 people. Up to 17 February 2012, 3,431 BRC’s had been carried out. 36 per cent of businesses were identified as having some issue with their record-keeping, of which 10 per cent had issues serious enough to warrant a follow up visit.

Following a review, which took into account representations by professional bodies including the ICAEW HMRC suspended BRCs in order to consult and have a re-think. They have recently announced a fresh approach to the original pilot programme.

The new approach started on 1 November 2012, such that businesses who are more likely to be at risk of having inadequate records will be contacted by letter to arrange for HMRC to call them to go through a short questionnaire.

Depending on the outcome of this call, HMRC will confirm to some businesses that no further action is required. Where some issues are identified, businesses will be offered targeted self-help education options. Businesses who are assessed as being at risk of keeping inadequate records will be referred for a BRC visit.

The roll-out of BRC’s will be done region by region, over a 14-week period beginning on 1 November 2012 and ending early in 2013. This is not a recommencement of the pilot but a full roll-out of the BRC process.

Full details are on the HMRC website at Business records checks.

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