The Forum of Small Businesses is warning all small businesses to check that their accounting records are up to date following the announcement that HR Revenue and Customs (HMRC) are stepping up their paperwork checks on small businesses in 2012.

HMRC estimate that around 28% of small businesses do not have adequate accounting records and so will be visiting around 20,000 small businesses in 2012 to carry out unannounced spot checks on their records.

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As well as these spot checks, HMRC are applying increasingly severe penalties for late payments and missed deadlines so ensure you are aware of your obligations.   A coach who has missed sending in their P11d form to HMRC by three months was hit with a fine of £450, having had no previous warnings from HMRC that it was overdue.   Be warned!