Tax Payment Question

Snookboi

From April 2007 there will be no choice but to return tax returns before Sept 30th, as from April 2007 the filing dates are being changed.

September 30th for returns subitted by paper, and November 30th for online filed returns.

This was suggested by a report released in the 2006 budget, however following complaints and consultation with the tax and accounting profession is being reviewed. I'm not certain but don't think it will be coming in next year.

Also should have mentioned, although this won't help with the payment due in January, if possible calculate your husband's tax position before the July payment is due and then you can revise the July payment if less is due.

silvercar

If you owe tax for 2005/06 from a single large dividend received from a wholly owned company, will the inland revenue require a POA for a similar assumed dividend for the following tax year?

reddevilled

silvercar wrote:

If you owe tax for 2005/06 from a single large dividend received from a wholly owned company, will the inland revenue require a POA for a similar assumed dividend for the following tax year?

If you are not going to receive a dividend in the following year and the rest of your incom is taxed at source then you can reduce your POA to NIL otherwise they will expect a payment on account.

Toni_Tax

Petmidget wrote:

That isnt correct, the £100 is for late filing of the return not payment. Their will be interest on any unpaid amount.

Any payments on account paid more than 1 month late carry a 5% surcharge.

The £100 penalty is for late payment of tax as well as/or for not paying your tax on time.

A little known trick though, if you cannot submit your Tax Return by 31 Jan the Revenue cannot charge you a penalty if you have paid any tax that is due by the due date of 31 Jan.

Re the original post, the best thing to do if call your accounts office and agree a payment plan with them if you can't manage the whole sum, as already suggested

Toni_Tax

silvercar wrote:

If you owe tax for 2005/06 from a single large dividend received from a wholly owned company, will the inland revenue require a POA for a similar assumed dividend for the following tax year?

Payments on account are due when your tax bill for the year is more than 20% of your 'overall tax liability'. Your 'overall tax liability' being the tax payable before any tax deducted at source (i.e. through PAYE) is taken into account.

So you would need to do that sum to see if you have to pay payments on account for 06/07.

If you think you will not owe any additional tax for 06/07 then you can apply to have the payments on account reduced to nil.

silvercar

So if I haven't decided whether to pay out a dividend in say February 2007, I'm going to be stung for a late POA if I do?

sean_rudenko

busiscoming2 wrote:

Hi Can anyone tell me how this business affects us. My husband went SE in January 06, did the self asses online months ago, what happens about payment - do they send a letter and add some for the POA? We havent heard a thing from them!

When your husband did the online assessment, there would have been an option to print off a copy of the tax return along with how much tax is due and the dates by when it has to be paid. This would also have included what rates of national insurance would be due and when.

Ring your tax office and they will provide the info you require.

Horace

I was SE until earlier this year - I completed my tax return before I had received a P60 from my main employer so forgot to complete a box on the form. Yesterday I received notification that they decided that I owed £3640 and that it should be paid by 31 January 07. I contacted my employer and found out the tax paid by me during the year to 31 March 06 and contacted the tax office this morning. Thankfully the amount has been reduced somewhat to £284.94 however, they had told me that they would change my tax code to collect this money previously but they then advised me today that they didn't bother to change my coding. Now I am left with a bill that I cannot pay because I dont earn much money and have monthly outgoings that leave me with a small amount of money for food and nothing for savings. Do I have to pay for their 'can't be botheredness'? I have asked if they can amend my tax code to see if it could be reclaimed that way but I don't hold out much hope. Any advice would be appreciated.

Hoddie_2

The £100 penalty is for late payment of tax as well as/or for not paying your tax on time.

No it isn't. It's purely a 'late return penalty'. Paying the wrong amount (or no) tax will result in interest and later a surcharge, but not a fixed penalty.

they had told me that they would change my tax code to collect this money previously but they then advised me today that they didn't bother to change my coding.

They cannot collect any underpayment of over £2,000 through PAYE. As the figures you originally put on your tax return resulted in a calculated liability of £3,640, they would never have attempted to collect this through PAYE, and I doubt they did explicitly say they would - the whole process is automated.

However, the final deadline for transfering liability to PAYE is the end/December - it would have to be done manually by the tax office but I don't see any reason why they couldn't do this for you. Call again and explain your situation. If they cannot help, contact the Accounts Office and request time to pay.