Self Assessment bill/distraint notice

Luna_Wolf

I could really do with some advice!

I worked full time for almost two years from Jan 2002 - Oct 2003, and tax was taken directly out of my salary. After that, there was a period of about six months where I did various freelance contracts and had to file a self assessment. I earned about £2000 during this six month period. After that, I became a full-time student for four years, and lived (frugally!) off my student loan.

In 2006 I started getting letters about owing money (approx £250) on my 2003/4 self assessment. I was confused because my earnings during that period were well under the limit, which I think was £4000 at that time. My accountant looked into it and advised me to ignore the letters. He tried to get more information so he could find out what was going on, but HMRC were not forthcoming.

The letters kept arriving over the next two years, and the bill kept growing. It reached £317. Finally, I got a notice of distraint - if I didn't pay the bill in two weeks, HMRC would come to my house, seize my belongings and sell them at public auction.

My accountant and I both contacted HMRC multiple times to try and get a copy of the tax return that had generated the bill. (Unfortunately I had not kept a copy of it - yes, lesson learned.) HMRC agreed to give me a 28 day extension while my accountant looked at the tax return. Except... they did not send it. We asked several times, SPECIFICALLY for the tax return. Each time we asked, they just sent some useless calculations from 2006, when I was living off my student loan. How they managed to multiply something by an income of zero and get a total of £317, I have no idea.

Way before the 28 day extension was up, they sent another letter saying that if I did not pay, they would start the legal process as soon as possible after the date in the covering letter. Against my accountant's advice, I dug into my savings and paid the bill. The possessions I have that are worth any money are the ones I use to make my living (I'm a self employed seamstress), and I absolutely cannot afford to lose them.

I don't think I will ever see the money again, but I'm going to fight hard to try and get it back. I'm angry as hell that they could demand money and threaten me to the point where it made me ill, yet refuse to provide any evidence of the supposed debt. Imagine how much evidence I'd have to produce if I was trying to recover money from them!

Is there anything I/my accountant can do to find out what the debt was for, and, if the bill was in error (as I am convinced it was), get the money back?

Many thanks in advance!

fengirl_2

You have obviously received very poor customer service from HMRC and you are entitled to write a strongly worded letter to the Inspector at your tax office. Outline your efforts to get a copy of this return as you have to us and say that you wish to make a formal complaint about the lack of response from the office.
Its not too late to put this right and get a refund if the bill was incorrect.
If you dont get satisfaction directly from your tax office, there is a formal complaints procedure which is on HMRC's website.

Luna_Wolf

Thank you very much for the suggestions. When I sent my payment I included a letter explaining exactly what happened, and said that the matter is not concluded and that my accountant will be pursuing it. If I don't hear anything within a couple of weeks, I'll definitely put in a formal complaint.

I just looked at their website, and apparently there is a free adjudicator service independent of HMRC. That's good to know, and will be the next step if a formal complaint doesn't yield anything.

Thanks again!

fengirl_2

I think you have been writing to the wrong place. HMRC is essentially in two bits - assessment and collection. Collectors (including the accounts offices) are geared up to accept and persue the tax which the assessment bit has told them is due. They are not really geared up to enter into debates about the rights and wrongs of a particular tax liability. Your arguement is with the assessment bit - ie your local tax office - where they will hold yur self assessments and your file.

Luna_Wolf

So I should be taking this up with the tax office in Shropshire (where I lived and worked in 2003/4)? The letters I was getting came from Newcastle, which confused me, but if it's two different parts of HMRC then that makes sense. The letters didn't make it very clear. Mind you, nothing about self assessment seems clear or straightforward to me.

Thanks again!

Ballymackeonan

Surely your accountant sgould have known which HMRC office was the correct one to write to?

emilyjayne_3

The letters coming from Newcastle would be from your Recovery office, the people who basically collect the debt. Your proccessing office, where you sent your return to in the 1st place, would be the ones holding all your past returns.

But surely your accountant should still have a copy on file if you dont ? Tax documents etc should be kept for at least 5 years. And if your accountant filled the return in, then it would of been his error that induced the amount you owed, HMRC work out the amount based on the figures in the return.

People trust their accountants wayyyy too much in my opinion ! Keep'um on a short leash !

RobertoMoir

It shocks me that your accountant told you to ignore a tax assessment from HMRC. That's pretty bad advice.

They should know who the tax inspectors office is that was dealing with you and you should be able to complain to the inspector in charge of that office

Luna_Wolf

Surely your accountant sgould have known which HMRC office was the correct one to write to?

He probably would have known if I'd thought to ask him. I wrote the letter myself, and it didn't occur to me that I might have sent it to the wrong place.

But surely your accountant should still have a copy on file if you dont ? Tax documents etc should be kept for at least 5 years. And if your accountant filled the return in, then it would of been his error that induced the amount you owed, HMRC work out the amount based on the figures in the return.

The problem is that I've since moved and have a new accountant, who's been trying to deal with this with only half the information. I guess I could try and contact my old accountant (who was really my father's accountant and didn't really have much to do with my stuff) and see if he still has my tax return, though it's been over 5 years. Now I think about it, though, I'm not even sure whether I filed the tax return through him or just filled it in myself, in which case it would be my error. I was very young back then and didn't know any better.

It shocks me that your accountant told you to ignore a tax assessment from HMRC. That's pretty bad advice.

They should know who the tax inspectors office is that was dealing with you and you should be able to complain to the inspector in charge of that office

That was the accountant I had when I lived and worked in Shropshire; I have a different one now I've moved, but I could try and contact him again for that info.

Thanks for all the suggestions everyone.

dori2o

If the letters came from Newcastle, are you sure it was a tax liability they were after and not National Insurance contributions?

suso

In 2006 I started getting letters about owing money (approx £250) on my 2003/4 self assessment. I was confused because my earnings during that period were well under the limit, which I think was £4000 at that time. My accountant looked into it and advised me to ignore the letters. He tried to get more information so he could find out what was going on, but HMRC were not forthcoming.


Why on earth would anyone ignore letters from the tax man saying you owe them money, They are not someone who just goes away if they don't get a response.

Write to the complaints manager at your office. Send it recorded delivery, say you need a copy of the return and why.

As you have paid off the debt then there is no need to copy in the debt management section