Suddenly HMRC mentions extra penalties...

VJP

Hello everyone

I've been really hot on paying down debts in the last year and one of these debts that I'm nearly at the end of paying is an HMRC bill (it was about £5-6K for a few years of occasional work on the side). I've being paying in installments of £100 / month since early 2012 and suddenly Iv'e received a bill which says I owe another £300+ for late payments. I rang to check this was correct as this was the first I'd heard of it, and I would have thought that these penalties would have been mentioned earlier, and at the very least when I specifically asked about possible penalties over the phone in early 2013.

I was told that this letter might be incorrect and to wait for another letter. The second letter says that I do indeed owe another £300. It might not seem a huge amount but I am really going all out on budgeting and cost cutting to pay off other debts so this is particularly disappointing!

Does anyone know whether HMRC was obliged to inform me in advance, or whether the fact they have told me right towards the end of me paying many installments could count in my favour? Or else whether late payments should apply at all when you are in an agreement with them - ie paying installments..(these penalties were applied because of three penalty dates passing as I was paying the initial debt off in installments). Penalties were never mentioned when this plan was set up and the only thing that was mentioned was interest.

Any advice / or experience welcome!

antonic

To help you we need more information such as :

1) Which type of tax is it ? (VAT/SA/PAYE).

2) What do the interest charges relate to ? - if your unsure ask for a breakdown

3) Did the original agreement specifically state that no interest would be charged ?

4) Have you incurred any further liabilities since it was agreed ?

With this info we *may* be able to help you

VJP

These are late payment penalities not interest payments. I am already paying interest and this was explained upfront so I am not worried about that.

HMRC never mentioned penalties back in 2012 and as far as I can tell they were not applicable because I had set up a payment by installation plan.

I have been told 2.5 years later about them.

The tax is self assessment income tax.