Help with a Tax issue...

Safehands

Hello all. Apologies if this is the wrong board for this post but it didn't seem to fit into any of the other categories.

I'm hoping that anyone who has had to pay tax that was unpaid in previous years can give me their opinions or advice.

Quick summary: I have been in full time employment since I was 16 years old (12 years ago). I've always worked for major companies and have paid tax by PAYE (I get a wage slip with tax & NI already deducted). I've never been unemployed and i've never had to fill out a tax return.... until now...

In 2006, the company I worked for had a sharesave scheme which I was a part of. The scheme matured early due to a takeover of the company and to cut a long story short, there was a tax liability on my part for the shares I was able to purchase at a reduced price. Perhaps I was naive or just didn't fully understand my obligations, but at the time, I didn't think I had to pay anything tax-wise and I used the money I earned to put down a deposit on my first home.

Cut to 2009, and I recenty received a letter from the tax office saying that they have "received information" that I was supposed to pay some tax in 2006 as a result of the above. They sent me a tax return to fill out and send back with all the details of the share scheme and my earnings for that year. I found the whole thing pretty daunting but filled it out as best I can.

I did some rough calcuations and I think they are going to demand from me somewhere aound £4000-5000. I simply don't have this kind of money laying around and am a bit worried about my options with regards to paying it back.

I have read on several sites that unpaid tax has to be paid back in full ASAP (within 12 months). I'm not sure I can do this. Has anyone been in a similar situation? Were you able to come to an agreement with the tax office with regards to a repayment plan?

I am hoping they will be leninent seeing as i've been paying tax ever since I was old enough to do so and have never claimed anything back from the government in my entire life.

kimdegsidash

Try reading HMRC's advice on problems paying your tax bill here: http://www.hmrc.gov.uk/payinghmrc/problems/cantpay-individuals.htm

Also, you might want to post on the 'Cutting Tax' forum.

From my experience, they take no account of the fact that you've always paid tax or have never made a claim. However, they have acknowledged the difficulties that many people are finding themselves in financially just lately and they do seem to be taking a more lenient approach right now.

See if you can find Lemma's posts to read up on her recent experience with HMRC.

lemma1968

Hi there

I have spent years in tax arrears. I have been sued...occasionally but i always pay.

The HMRC are much more patient now.

If you have received your tax liability figure then you need to contact the HMRC and explain your difficulties.

I wrote to them and included a copy of the SOA that is available on this site so they could see what I could afford.

They have agreed a payment schedule that will take me over the 12 months when my next liability will be due. They know this and have been fine about it. I owe much more than you do and i have been able to reach an agreement.

You need to be up front with them, and realistic in your SOA.

You will be charged interest, but you may be able to avoid the surcharges if you get to them before they get to you.

Are you still earning? Employed or self employed?

You will be fine.