Self assessment penalties stress

urallmine

Hi i was wondering if anyone could help me . My wife has been sent not one but three self assessment penalties for 2011/20120,2012/2013,2013/2014 but has never been self employed in her life . My wife phoned them and after waiting for about an hour finally got through and was told to send her tax earnings for the years above , she has been working for the same company for the years above . So she phoned her company and asked if them if they could help her . They told her that the company had been bought by a different company in one of the years that were in question and that they couldn't get hold of all the financial records . So my wife phoned HMRC back and told them that she was unable to get her tax earnings for the three years in question , then to her dismay was told that they (HMRC) could send them to her and then she could fill in the late penalty forms and send them back by the 2nd of July she asked them if that's what they needed then why send them out just use them their reply was oh no we have to send them to you so that you can send them in OMG unbelievable . Now that would be some kind of magic trick as she didn't receive the letter with the tax earnings on until the 3rd of July and there was no self assessment form with the letter and only now finding out ( as she has never had to do one before ) that it can take up to 20 days for an activation code to come through for an online form. The stress this is causing is phenomenal any advice would be much appreciated thanks

Savvy_Sue

Does your wife not keep her P60s, given to her each year by her current employer? Or the final payslip of each tax year would do the same job.

Plus P45 if one company was taken over by another.

chrismac1

It seems to me that the key issue is how your wife got into the self-assessment system and when - if ever - she was sent a notification to file tax returns for the years in question. HMRC's systems are unbelievably dreadful and their recruitment policy involves the monkey cages at London Zoo.

What this means is that the incidence of error in HMRC is MUCH higher than what you would expect even in pretty incomptent private sector organisations such as banks. So there is every chance that she was not given adequate notice that they required her to file these self-assessment returns, or that they sent them to the wrong address or similar muck-ups.

A successful appeal requires to meet the test of a "reasonable excuse". In the past just about every reasonable escuse you can think of, including sudden unexpected death, was rejected out of hand by HMRC staff - see the recrtuitment policy referred to earlier in this thread.

But lately it has dawned on the top brass that this results in the Tribunals being clogged up with these sorts of cases, and in turn HMRC spending money on them and then losing them.

So for once commonsense has now broken out and several hundred thousand taxpayers have had their 2013-14 late filing penalties reduced to zero on a first letter to HMRC.

In a nutsehll one possible approach is:

1. Figure out what has happened as much as you can.
2. Google "self assessment penalty reasonable excuse".
3. Appeal based on the facts and stating that you meet the reasonable escuse test and why.

anniecave

Savvy_Sue wrote: »

Does your wife not keep her P60s, given to her each year by her current employer? Or the final payslip of each tax year would do the same job.

Plus P45 if one company was taken over by another.

Payslips can differ from P60s/P45s if you contribute to a pension via salary sacrifice. In this case you'd need to be careful to use the P60/P45 figures.

I was doing a tax return the first year after I started contributing to my current pension, putting my payslip figures in, and wondering why the online calculation was saying I owed tax that I knew I didn't!

urallmine

hi all and thanks . the first time my wife heard about the self assessment penalties was about 2 months ago and that's all three of them . My wife is making an appointment to speak to a citizen advice adviser . Its a messed up system when one department cant give information to the other . They have obviously mixed something up somewhere and now my wife has to suffer for it .

PlutoinCapricorn

Self-employed people certainly do need to complete self-assessment returns. However, there are other reasons for being required to self-assess. Higher rate tax payers, ministers of religion, some company directors, income from letting out property, high investment income...
if you get a notice to file you must do it or face penalties, but then you can ask to be removed from the system if you do not qualify.

urallmine

My wife doesn't qualify on all circumstances

zygurat789

PlutoinCapricorn wrote: »

Self-employed people certainly do need to complete self-assessment returns. However, there are other reasons for being required to self-assess. Higher rate tax payers, ministers of religion, some company directors, income from letting out property, high investment income...
if you get a notice to file you must do it or face penalties, but then you can ask to be removed from the system if you do not qualify.

How much untaxed interest from Santander (Abbey National) would it take to prompt a tax return?

DebbieR

It sounds like your wife has underpaid tax in one or more of these years which couldn't be collected through her tax code in later years. She should have been sent notification at some point that she's underpaid the tax and given the chance to make a voluntary payment. If there's no response to this request HMRC send a reminder. If there's no response to that, she would have been sent a Notice to File tax returns for the years involved. She would have three months to submit these. This is common practice now. If none of this has happened it could be that HMRC have an old address on record? What she needs to do is check the letter she got from HMRC with her employment details on against the records she has for the year. Maybe if you post the details for each year some kind person on here would be able to tell you where the underpayment arises.
Once you've filed the returns HMRC can review the liability. Send in an appeal against the penalties. If her correspondence has been sent to the wrong address in the first instance she'd have a reasonable excuse. HMRC tend to be more lenient with first time filers too.