Sitting Comfortably

A husband and wife partnership were involved in the manufacture of furnishings and subsequent refurbishment of hotels etc. The partnership had informed the Revenue that the gross profits had varied due to a change in the nature of trade, in order to make the business more successful. The Inspector was not satisfied with the explanation, and decided to investigate the accounts.

The Inspector was very persistent, and the partners were required to explain all entries on both business and private bank accounts, and to give details of their private lifestyles.

Various allegations were made by the Inspector, but following several discussions with the accountant, and a visit to the factory, he became convinced that the taxpayers' explanations were correct and was satisfied with the accounts.

Accountant's fees of over £2,000 were paid under the fee protection policy.