A £2.4 billion error: Why you need to ensure your accounting figures are correct
HM Revenue and Customs (HMRC) has acknowledged an error it made when publishing Valued Added Tax (VAT) figures that may impact the provisional 2025 to 2026 year-to-date receipts.
In its report, HMRC reported that its VAT cash receipts for April to August 2025 were under-reported by £2.4 billion due to an initial error in the reporting.
The mistake highlights how easy it can be, not just for regulatory bodies like HMRC but taxpayers and businesses, to make mistakes when calculating their figures.
Accounting for too much or too little can be problematic because it creates a ripple effect that doesn’t just affect you but also your family and your business.
How was the error discovered?
The Office for National Statistics (ONS) blamed a VAT receipts data error made by HMRC for why their most recent release of tax and spending figures was incorrect.
This was just one of a series of mistakes made, which ironically has saved the Chancellor £3 billion as she puts her plans in place to improve the UK’s economic climate and balance the Government’s books.
The mistake meant initial figures had to be corrected and while the reversed figures did highlight lower borrowing costs, it still leaves taxpayers and businesses in a difficult position where it is unclear how much this will impact the Autumn Budget.
However, the mistakes will no doubt cause concern, frustration, damage trust and leave many questioning the reliability of data when it is released into the public domain.
How do I avoid making accounting mistakes?
With the ONS and HMRC confirming major errors with the figures, it emphasises just how easy it is for anyone to make mistakes.
With tax obligations to fulfil, it is important that businesses, self-employed individuals, sole traders and landlords are calculating their figures correctly because, as we’ve seen, one error caused a rippling effect across many pieces of financial data.
One error found in your accounting and reporting can lead to unwanted investigations, potential fines, sanctions and reputational damage that is hard to recover from.
It’s an important reminder for you as a taxpayer to ensure your figures and information are correct when submitting your tax returns to HMRC.
A DIY approach to accounting brings the risk of making mistakes that don’t just affect you but also your business and your employees.
Accountants can take that pressure away because they are far more accurate, which saves you time to allow you to focus on other areas.
It is also beneficial to use accountants for your long-term financial planning and you can submit information to HMRC without the worry of facing any punishments for inaccurate data.
If you are concerned that your figures are incorrect, our expert team of accountants is here to help.
We can help you clarify if your figures are correct and provide support for all the tax and financial concerns you have.
We are here for you and your business, helping you confidently understand your finances and ensure your data is correct ahead of meeting your obligations with HMRC.
HMRC’s error proves how dangerous one mistake can be, so don’t underestimate the importance of having financial data that is accurate.
Contact our team today for expert financial advice and support.
