HM Revenue & Customs (HMRC) bagged more than £3bn from small businesses in the last year by cracking down on two types of taxes

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The taxman brought in more than £3bn from small businesses last year after honing in on two types of taxes, figures out today show.

Research by PfP discovered HM Revenue & Customs (HMRC) raised an additional £3.3bn from small businesses by cracking down on underpayment of VAT, and warned those yet to get their books in order that similar investigations are likely to follow.

"The figure will be driven by a combination of carelessness, genuine error or misunderstanding, as well as deliberate and calculated underpayment," said Kevin Igoe, managing partner of PfP.

"While the vast majority of small businesses are compliant, the actions of a rogue few mean that HMRC is likely to look closely at the tax affairs of all over the coming months. Many innocent businessowners are likely to find themselves under close scrutiny as the Revenue looks to weed out any remaining underpayment."

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Meanwhile, research by law firm Pinsent Masons discovered the taxman had also pocketed an additional £322m from small businesses, as well as an additional £383m from larger firms, by taking a closer look into payroll taxes.

Pinsent Masons warned that, although a chunk of the sum was likely due to errors and simple mistakes, some of the figure was also likely down to HMRC having a closer look at employment status and rooting out those falsely reporting to be self-employed.

"Businesses of all sizes need to be careful to keep tax affairs in order so as to avoid any investigations, and also seek advice where necessary," cautioned Paul Noble, tax director at Pinsent Masons.

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A HMRC spokesperson said: "We aim to treat all businesses, large or small, both fairly and consistently. Acting in the interests of the vast majority of businesses who play by the rules, our teams are busy tackling the minority who don't."

On the subject of employment taxes, the spokesperson added: "When the employment relationship does not accurately reflect the underlying reality of the relationship, the wrong tax is paid. HMRC has powers to correct the tax treatment when the employment relationship is not what is claimed."

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