Late Filing Penalty - Appealing but should I pay it in the meantime?

chocolateteabag

Hi
Long back story but I would like to know if I should pay a late filing penalty while I am in the process of appealing against it?

6 Sept - I received a late penalty notice saying I had to pay £100 by 6 Oct for Tax Year 14/15 (in which I was under PAYE employment - did not go self employed until 15/16 tax year)

Sent appeal off which is on their system as received 15 Sept

Have been advised by the SA help team that the Tax Office are dealing with the appeal and to expect a response by 12 Oct.

Should I pay the fine in the meantime?
Any advice would be greatly appreciated!

Dazed_and_confused

Before worrying about the penalty have you actually now submitted a completed tax return?

chocolateteabag

No I haven't - because I didn't need to? I registered for self assessment in Tax year 16/17 - I owed tax in 15/16 - so I don't understand why I now need to complete a return for 14/15.

The letter on 9 Sept was the first time they have contacted me.

chocolateteabag

Surely completing a return which says I owe zero tax (as I was under PAYE for that year) is a bit pointless?

or is this how HMRC works? ie Computer says No?

Thank you for your reply by the way!!

Dazed_and_confused

Experience of these threads on MSE has shown that the HMRC don't issue tax returns for the fun of it. You may not immediately see it but there is highly likely to be a reason for them issuing the return.

You seem to be linking being self employed with the need to complete a self assessment tax return but there could be many reasons why the HMRC consider a return is needed and once issued you normally do need to complete it.

If you haven't filled one in how do you know you don't owe any tax (if you say because I'm on PAYE it will give you away as a newbie to this thread )

Wayne_O_Mac

They're unlikely to consider your appeal until the return's been submitted. You will have to complete the return, regardless of when your self employment started.
If your appeal is successful, then the penalty will be cancelled. If not, then interest will already be running on it.

Cook_County

If a return has been issued you are required to file it.

Pennywise

I've had a few of these successfully appealed without submitting the tax return. It seems that "some" HMRC workers set up a SA for the wrong year for people starting self employment. When it is clear it's a mistake at their end, most time they're willing to cancel the requirement for a return for that earlier/wrong year.

Rather than appealing and waiting, you'd be better just phoning them up, confirming dates with them, and they may well just cancel the return over the phone.

chocolateteabag

Thank you for all replies.

HMRC haven't requested a return for 14/15 - I registered for Self Assessment in 15/16 and submitted my tax return for that tax year. They have then sent me a late filing penalty for 14/15.

Pennywise - what you've described sounds like what might have happened to me. I will give calling them a go.

Again - thank you for all your replies on this

TheCyclingProgrammer

Did you receive a Notice To File a Tax Return for the year 2014/15? If you are certain you did not, then the penalty should be cancelled as you were under no obligation to file one until you received such notice.

What date did you register for self-assessment? When did you receive a notice to file a tax return for 2015/16? (it would have been after April 5 this year). When did you submit that return? (it isn't due until 31 Jan 2017).

TheCyclingProgrammer

Pennywise wrote: »

I've had a few of these successfully appealed without submitting the tax return. It seems that "some" HMRC workers set up a SA for the wrong year for people starting self employment. When it is clear it's a mistake at their end, most time they're willing to cancel the requirement for a return for that earlier/wrong year.

Rather than appealing and waiting, you'd be better just phoning them up, confirming dates with them, and they may well just cancel the return over the phone.

Even if this happened, wouldn't they still need to issue a notice to file a return for the earlier year, in which case the deadline would be extended (3 months after receiving the notice to file isn't it?).