Child Benefit. ,

Jayd30

Need some advice if possible. 

I am a PAYE employee and have been for many years now. Until recently and Martin highlighting the changes in child benefit thresholds, myself and my wife did not realise that because I was earning over 50k (from 2020 onwards) that for some years we actually were not entitled to claim child benefit, well I say that we can but then we have to pay back at the end of each year. 

Because I was not aware of this until recently we immediately took it upon ourselves to contact the child benefit office and get it stopped with immediate effect. 

I was able to submit a self assessment return for 2022/2023 however I am waiting for HMRC to send out forms for 2020/21 and 21/22 tax years. 

After calling them today they said that I could appeal any late penalty charges but I would not be able to appeal any interest they would add for missed returns. The question is, is this correct? 

If we had not contacted them and held our hands up to say we owe this money they would not have known, they have never written to myself or my wife advising that we would need to assess our child benefit receipt and the fact that they knew my earnings because they always write and tell me that my tax code is changing when I have had salary increases in my opinion puts a portion of the responsibility on them. 

So for 2020/21 and 2021/2022 tax year that are likely to add interest on the amounts owed (backdated) which seems completely unjust. 

I am willing to pay back every penny of child benefit which we have had since 2020 but not willing to pay back interest when they have never contacted us at all with regards to this matter. 

Any help/advice greatly appreciated. 

peteuk

I would say it was up to you to advise them of any changes, the thresholds have been in place for many years so therefore they are unlikely to agree with the fact that you’ve only just heard about it (right or wrong - they have advertised this as much as possible) 

If they owed you, you'd be asking for interest, so why not the other way around…

I would wait until advised of the full figure owed and go from there, anything else is pure speculation. 

sheramber

If you had not contcted there would have been even more interest to pay when they did find out in future years.

Dazed_and_C0nfused

Jayd30 said:

Need some advice if possible. 

I am a PAYE employee and have been for many years now. Until recently and Martin highlighting the changes in child benefit thresholds, myself and my wife did not realise that because I was earning over 50k (from 2020 onwards) that for some years we actually were not entitled to claim child benefit, well I say that we can but then we have to pay back at the end of each year. 

Because I was not aware of this until recently we immediately took it upon ourselves to contact the child benefit office and get it stopped with immediate effect. 

I was able to submit a self assessment return for 2022/2023 however I am waiting for HMRC to send out forms for 2020/21 and 21/22 tax years. 

After calling them today they said that I could appeal any late penalty charges but I would not be able to appeal any interest they would add for missed returns. The question is, is this correct? 

If we had not contacted them and held our hands up to say we owe this money they would not have known, they have never written to myself or my wife advising that we would need to assess our child benefit receipt and the fact that they knew my earnings because they always write and tell me that my tax code is changing when I have had salary increases in my opinion puts a portion of the responsibility on them. 

So for 2020/21 and 2021/2022 tax year that are likely to add interest on the amounts owed (backdated) which seems completely unjust. 

I am willing to pay back every penny of child benefit which we have had since 2020 but not willing to pay back interest when they have never contacted us at all with regards to this matter. 

Any help/advice greatly appreciated. 

They would have caught up with you eventually and had that happened you would likely have ended up with more to pay overall.

For the avoidance of doubt what penalties are you referring to?

Late payment interest is going to be charged as that simply reflects the fact you have had the benefit of the money HMRC should have had.

But people often misunderstand penalties.

Jayd30

They would have caught up with you eventually and had that happened you would likely have ended up with more to pay overall. For the avoidance of doubt what penalties are you referring to? Late payment interest is going to be charged as that simply reflects the fact you have had the benefit of the money HMRC should have had. But people often misunderstand penalties. ______________________________________________________________________________________
@Dazed_and_C0nfused

So I have paid what they said I owe for the 2022/2023 tax year which was a total of £1911.79. This went up to £1913.79 but they have now wiped that additional few £ off and for this year they have penalised me £94 for filing a 30 day late return which I have appealed and waiting for a decision. The truth is all of this was an honest mistake. And whilst yes these rules may have been in place since 2013 not being in the high earners bracket it never occurred to me when my salary went over the threshold which I did not know even existed to look into. Apart from Martin highlighting this so much recently I have never seen the government actually doing any form of informing and being a PAYE earner never occurred to me that I even needed to do a self assessment tax return. HMRC have never triggered anything to me to do a return and have certainly never written to us knowing my income as they change my tax code accordingly each year to say you need to review your child benefit receipt, which when I spoke to them yesterday the person I said yesterday said some will have received letters!! After speaking to them directly they have informed me that they apparently cannot take off interest but what worries me more now is the actual late filing penalties. For 2020/2021 the late filing penalty would be £1600 For 2021/2022 the late filing penalty would be £1600 This is then on top of interest that we will have had added and the child benefit to pay back, we'd be looking at a total bill of around £9k!! I guess I am going to have just appeal any penalties and hope that they drop them. As I say this was a genuine mistake and a complete oversight. Will wait and see what happens

Jayd30

@peteuk point taken but honestly it was a genuine oversight, I've never not paid a bill in my life and IF we had of known the rules (which we did not I can assure you) we would of stopped the child benefit as soon as we found out which sadly for us is now!  

I get that yes interest will be charged and cant be helped but late penalties seems a little unfair for a person who is a PAYE tax employee and was genuinely not aware of the need to submit a self assessment return. 

And sorry the chances of getting the Govt to pay interest on anything they owe you would be a very big challenge indeed 

Dazed_and_C0nfused

Late filing penalties can only be charged if you don't complete the return within 3 months of it being issued (or a notice to file a return being issued).

To get late filing penalties of £1,600 indicates returns were issued a long time ago and weren't filed.

Which is somewhat different to what your original post implies.  That you have only recently become aware of HICBC and returns (or notices to file returns) had not yet been issued.

I was able to submit a self assessment return for 2022/2023 however I am waiting for HMRC to send out forms for 2020/21 and 21/22 tax years. 

What is the correct position???

Jayd30

Dazed_and_C0nfused said:

Late filing penalties can only be charged if you don't complete the return within 3 months of it being issued (or a notice to file a return being issued).

To get late filing penalties of £1,600 indicates returns were issued a long time ago and weren't filed.

Which is somewhat different to what your original post implies.  That you have only recently become aware of HICBC and returns (or notices to file returns) had not yet been issued.

I was able to submit a self assessment return for 2022/2023 however I am waiting for HMRC to send out forms for 2020/21 and 21/22 tax years. 

What is the correct position???

The correct position is this: 

Since 2020/2021 tax year I started earning over £50k. 

When I started looking into this matter the week before last I was only able to submit an online return for the tax year 2022/2023. This has been completed and they said we owed £1911.79 (this included interest). This has been paid and they are now asking for £94 30 day late penalty for that tax year. I have submitted an appeal for the late penalty charge.

I was never issued a return for 2020/2021 or 2021/2022 tax year. I have had to ask HMRC to send me out forms for these years (received today) and they have also opened up these years on the gov gateway now so I can complete online. 

I have used their online penalty calculator to get a summary for each year of what the interest and penalties would/could be for each year £1600 late penalty + Interest + paying back the child benefit.

They have never issued me self assessment returns for 2020/2021 2021/2022 and I have never received any notice to file a self assessment return for these years. 

peteuk

Jayd30 said:

@peteuk point taken but honestly it was a genuine oversight, I've never not paid a bill in my life and IF we had of known the rules (which we did not I can assure you) we would of stopped the child benefit as soon as we found out which sadly for us is now!  

I get that yes interest will be charged and cant be helped but late penalties seems a little unfair for a person who is a PAYE tax employee and was genuinely not aware of the need to submit a self assessment return. 

And sorry the chances of getting the Govt to pay interest on anything they owe you would be a very big challenge indeed 

Totally get it, but put the shoe on the other foot, your HMRC and how many times have they been told it was an oversight. 

It took them over a year to work out I had been paid over £50K and so I owe income tax, this was due t multiple employees two of which overlapped, and one of those then paid out an immediate pension and even though I told them to the pence how much I was earning to avoid such underpayment, they still managed to mess it up. 

HMRC/DWP can not monitor everything, so the honest is on the individual to report it. But I totally get your not happy with the charges, given the deadline was 30 Jan 24, although I suspect if you completed it 01 Feb there would still be a risk of charges for not completing it before the deadline date. 

Dazed_and_C0nfused

Jayd30 said:

Dazed_and_C0nfused said:

Late filing penalties can only be charged if you don't complete the return within 3 months of it being issued (or a notice to file a return being issued).

To get late filing penalties of £1,600 indicates returns were issued a long time ago and weren't filed.

Which is somewhat different to what your original post implies.  That you have only recently become aware of HICBC and returns (or notices to file returns) had not yet been issued.

I was able to submit a self assessment return for 2022/2023 however I am waiting for HMRC to send out forms for 2020/21 and 21/22 tax years. 

What is the correct position???

The correct position is this: 

Since 2020/2021 tax year I started earning over £50k. 

When I started looking into this matter the week before last I was only able to submit an online return for the tax year 2022/2023. This has been completed and they said we owed £1911.79 (this included interest). This has been paid and they are now asking for £94 30 day late penalty for that tax year. I have submitted an appeal for the late penalty charge.

I was never issued a return for 2020/2021 or 2021/2022 tax year. I have had to ask HMRC to send me out forms for these years (received today) and they have also opened up these years on the gov gateway now so I can complete online. 

I have used their online penalty calculator to get a summary for each year of what the interest and penalties would/could be for each year £1600 late penalty + Interest + paying back the child benefit.

They have never issued me self assessment returns for 2020/2021 2021/2022 and I have never received any notice to file a self assessment return for these years. 

You have misunderstood how late filing penalties work.

There cannot be a late filing penalty if you submit the returns within 3 months of them (or the notices to file) being issued.

Interest is different and will be charged.

Jayd30

Dazed_and_C0nfused said:

Jayd30 said:

Dazed_and_C0nfused said:

Late filing penalties can only be charged if you don't complete the return within 3 months of it being issued (or a notice to file a return being issued).

To get late filing penalties of £1,600 indicates returns were issued a long time ago and weren't filed.

Which is somewhat different to what your original post implies.  That you have only recently become aware of HICBC and returns (or notices to file returns) had not yet been issued.

I was able to submit a self assessment return for 2022/2023 however I am waiting for HMRC to send out forms for 2020/21 and 21/22 tax years. 

What is the correct position???

The correct position is this: 

Since 2020/2021 tax year I started earning over £50k. 

When I started looking into this matter the week before last I was only able to submit an online return for the tax year 2022/2023. This has been completed and they said we owed £1911.79 (this included interest). This has been paid and they are now asking for £94 30 day late penalty for that tax year. I have submitted an appeal for the late penalty charge.

I was never issued a return for 2020/2021 or 2021/2022 tax year. I have had to ask HMRC to send me out forms for these years (received today) and they have also opened up these years on the gov gateway now so I can complete online. 

I have used their online penalty calculator to get a summary for each year of what the interest and penalties would/could be for each year £1600 late penalty + Interest + paying back the child benefit.

They have never issued me self assessment returns for 2020/2021 2021/2022 and I have never received any notice to file a self assessment return for these years. 

You have misunderstood how late filing penalties work.

There cannot be a late filing penalty if you submit the returns within 3 months of them (or the notices to file) being issued.

Interest is different and will be charged.

So technically as they have only issued the 2020/2021 and 2021/2022 self assessments in April 2024 at my request. I have three months to complete and they cannot apply late penalties?