HMRC to write off any underpayments for 06/07

johnsmi

Hi there,

I know some people are skeptical about things in the daily mail, but in yesterday's money mail, it stated that HMRC are going to write off any underpayments for 06/07. I take it from that earlier years would be written off too.

Anyone heard confirmation of this from other sources?

John

Mikeyorks

In 2008 HMRC set out new rules regarding shortened timeframes for people claiming repayment. In essence - 4 years instead of 5/6. At the same time there was an element of 'mirror image' whereby they would not assess for emerging liabilities of equal age.

But the repayment deadline is finite ...... the deadline below which HMRC will no longer go is heavily caveated (see my bold italics below). It's far from 'writing off' ..... that's the media slant. This info was in the 2008 Budget.

The 2008 Budget changed how HM Revenue & Customs (HMRC) check whether someone’s tax is correct, and introduced new safeguards for customers. This was done to make the compliance checks more consistent, clear and uniform across a number of taxes. For more information about the new compliance checks please see 'How we check your tax'.
As part of those changes HMRC introduced a standard limit of four years from the end of the tax year for making claims for repayments of tax. A repayment claim is where a taxpayer asks for tax to be refunded, usually because they are entitled to a specific relief from tax which they have not previously claimed.
HMRC also introduced a limit of four years for the department to issue tax assessments (except where a loss of tax has resulted from carelessness or has been done deliberately). A tax assessment is where the department asks a taxpayer to pay tax that has not been included in a return.
The previous limit for claims and assessments for Income Tax and Capital Gains Tax was five years from the 31 January immediately following the tax year. So the time limit for the 2003-04 tax year was 31 January 2010.