Scared to admit to tax mistake!

dori2o

I may be mistaken, I have only scanned through the thread so far, but it seems you have not answered what is a very important question in this case.

Did you have a part ownership of the property? I.e was the property in joint names?

dori2o

chrismac1 wrote: »

Question : how many people in this post think anyone in HMRC actually reads tax returns any more? My answer to that is they don't. So you're not really giving them any extra information by ticking that joint box, it's not as if this is a partnership return where you're putting down both UTRs and if UTR 1 and UTR 2 don't add up the database is going to identify that.

Incidentally the fact that tax returns are no longer read is very useful. I use the "Other information" box on a regular basis for "insurance" purposes to cover potential enquiry issues. Then at least if there is an enquiry and the first question is "Why have you not disclosed this?" you can safely answer "Here is a printout of the notes to the tax return where we disclosed this, don't you read these?"

Quite honestly it depends on how the return is captured.

Online returns are rarely 'read' unless they are selected for review/enquiry.

However, how exactly do you expect full paper tax returns to be processed without somebody reading through it.

Granted, the short return is scanned, unless it has attachments or has been corrected and figures entered outside the box, but all other teturns that are not filed online are read and captured by human hand. Additional information in box 19, page TR6 is notified on the capture, and if the record is selected for review/security check/enquiry then this information is reviewed.

I must say from the majority of your posts it really does confirm that you have no idea at all how HMRC processes work.

As you claim to be an accountant, I'd be rather worried for your clients.

lazer

Just a few comments on this even though I have noticed above that you have already sent the letter

Firstly - It is unlikely that HMRC will need you to do a tax return simply for one rental income, a letter will usually suffice and you tax code will be altered accordingly each year

Secondly - I suggest you google allowable expense for rental income, as this may include things you are not aware off
Do you rent the house out furnished - if so you are entitled to a 10% wear and tear allowance (10% of the actual rental income will therefore be deducted from the current profit).

If you use the wear and tear allowance you cannot therefore actually claim for the costs of replacment furnishings

Good luck

chrismac1

No need to worry for my clients, dori2o. Just in the last month HMRC have:

1. Agreed that the HMRC credit control wing were being too aggressive in trying to wind up a perfectly solvent client with short term cash flow problems, so not proceeded with the winding up order.

2. Reduced a fine of £800 for PAYE / NI non-compliance to £156 which I am taking to the Tribunal because it should be zero.

3. Completely dropped a planned PAYE / NI inspection due on Tues 1 November after my client and myself explained the system over the phone and demonstrated by phone that the main reason for the planned visit - status enquiries - did not apply to my client.

And that is just one month's worth of HMRC dealings.

NicChanna

Hey!
@lazer ... the thing is the rental income non-payment spans 4 separate tax years. :eek: That's why I have written a letter about 2010/12 and am expecting to have to fill in forms for the rest.

Also I've already stated I want to claim 10% wear and tear allowance as it's a fully furnished house.


@dori2o ... yep the property was and continues to be in both names.

Still waiting for reply, but I imagine they are pretty busy this time of year ...

lazer

NicChanna wrote: »

Hey!
@lazer ... the thing is the rental income non-payment spans 4 separate tax years. :eek: That's why I have written a letter about 2010/12 and am expecting to have to fill in forms for the rest.

Also I've already stated I want to claim 10% wear and tear allowance as it's a fully furnished house.


@dori2o ... yep the property was and continues to be in both names.

Still waiting for reply, but I imagine they are pretty busy this time of year ...

We had the same situation with my mum and dad and they were happy to takee a simple statement of income for all the years, even backdated.

Although, It can sometimes be easier to actually fill in the returns and pay the tax in one go.

As for the 10% wear & tear allowance, I don't think you need to state them that you want to claim it - you just do in your accounts. If you are providing them with a letter it should simply be

Income XX
Expenses XX
Profit XX

The wear and tear allowance is simply included in the expenses
You need to keep the accounts for your own benefit for 6 years, as HMRC do have the right to ask to inspect them.

NicChanna

Still waiting ...

jennifernil

I would expect a long wait, seems to be about 12 weeks to get a reply to a letter.

My OH sent in his paper return in late July, still not had anything back 3 + months on, and we know he will have tax to pay.

gokuaiba

. please let me know if I'm being an oaf and getting this wrong ...

NicChanna

gokuaiba wrote: »

. please let me know if I'm being an oaf and getting this wrong ...

Hey Gokuaiba not sure if there's anything else you wanted to add to that?

Anyway I've just received a new tax coding for 2011/12 that will take care of the tax from now on, just waiting for the paperwork to do the returns for the previous years.

Woo!! It's getting all sorted out!