FSB demands apology from Revenue

The Federation of Small Businesses (FSB) has written to Chancellor Gordon Brown to demand a public apology from the Inland Revenue after it sent letters to thousands of small businesses suggesting that their tax returns may be incorrect.

The so-called 'enabling' letters say: "We have identified an aspect of the self employment pages of your return which may need particular attention" - but doesn't specify what it is.

According to the Revenue the letters outline common errors to 'enable' taxpayers to complete future returns accurately.

But the result has been a wave of confusion and anxiety among innocent business owners who assume the letters are the opening shot of a full blown Inland Revenue enquiry.

Meanwhile accountants, whose clients have accused them of making mistakes, have incurred additional costs and fear they have suffered a slight on their reputation.

The FSB has branded the misleading mailshots a disgrace and is urging the Chancellor to ensure the IR sets the record straight.

In the letter to Gordon Brown, the FSB calls for the Revenue to write to all the recipients of the mail out and apologise.

FSB Tax Chairman Neil Hamper said: "The letters are a complete disgrace. They are vague and misleading. They suggest that a specific problem has been identified when in fact the letters have been generated by computer on the basis of standard triggers.

"The vast majority of tax payers that receive the letter will have filed their return correctly and paid the right amount of tax.

"It's a case of let's shake the tree and see what falls out. We have written to Gordon Brown to express our concern and to urge him to ensure the Revenue sets the record straight."