Why has my business received a letter?
HMRC will issue ‘nudge letters’ to approximately 4,000 businesses in the hospitality sector where it suspects incorrect claims have been made, urging claimants to check that their claims are correct. Claimants will have 60 days to respond to HMRC or incur the risk of HMRC opening formal compliance checks. Those that receive the nudge letters must check the accuracy of their EOTHO claims and, if appropriate, repay some or all of the payments they received.
Repayments may be due because claimants:
- Claimed for more EOTHO payments than they were entitled – this is based on the information HMRC holds about their business, the amounts claimed and the data HMRC holds about the payments they have received by credit and debit card.
- Have one or more EOTHO claims that appear inconsistent with other EOTHO claims made.
- Have not met the eligibility criteria to claim or receive EOTHO payments.
- Made a manual claim for EOTHO and other compliance risks were noted.
EOTHO claimants receiving the HMRC nudge letters may need to provide evidence with regards to the eligibility of their sales and their EOTHO calculations. Claimants who cooperate with HMRC and respond to the nudge letter within 60 days and voluntarily repay any overpaid EOTHO payments, making a full disclosure, will not be charged a penalty for the error in their claims. Claimants who do not cooperate and do not respond to HMRC’s nudge letter within the 60 days, leading to HMRC opening formal compliance checks, are likely to face statutory interest and penalties. In the more serious cases involving fraud and criminal attacks, criminal prosecutions are expected.