Testing the feasibility of EOTHO claims
In May 2021, Buzzacott was contacted by Olivia, a Director of a hospitality business in need of professional representation. Her business had received a letter from HMRC, notifying her that it had opened a check into EOTHO claims made by her business. While the business had made claims on behalf of its two cafes throughout the EOTHO period, there was no reason at the outset to suspect that the claims may contain errors.
We worked with Olivia and conducted a full review of the businesses’ affairs to establish the feasibility of the claims. We closely examined the number of covers for each claim period, the size and number of maximum covers for both premises, the business’ opening hours, and the level of turnover in the same period of the previous year of trading.
From this review, we concluded that the business was capable of dealing with the number of diners submitted within the EOTHO claims – which had been its key risk when HMRC launched the claims check. We presented this to HMRC, who fully accepted our analysis work and agreed. However, HMRC then went on to undertake its own analysis work in respect of the cafes’ till reports comparing these with claims for each EOTHO period. As a result, HMRC believed there to be errors within the claims.
Buzzacott carefully tested HMRC’s analysis work from which we concluded it contained some crucial mistakes. We established that the EOTHO claims for certain periods had been inadvertently mixed up between the two cafes, which in turn, resulted in overclaims and underclaims being submitted.
After further discussions with Olivia, we discovered that the employee who ordinarily handled the business’ financials had been furloughed during the EOTHO scheme, leaving her to deal with the claims herself. Upon reflection, she accepted that because of her lack of expertise in data analysis, coupled with the immense pressure of running a business during the pandemic, it was possible that she had made mistakes when entering the figures into HMRC’s portal. While the business had made a moderate overclaim in the first week of the scheme, this was offset by a sizeable underclaim during the final week of the scheme.