I owe HMRC money but they never told me!

Bambers29

Hello everyone. Any help would be greatly appreciated. I am in the Army and have been for the 22 years. I have never had anything to do with my PAYE tax as a government employee and have never completed self assessment (until recently) and have never been told that I needed to. I get the odd email from HMRC informing that the self assessment window will close on such and such date in the same way that an advert pops up on TV from time to time informing me of the same thing. I have never had a letter / email / online message from HMRC telling me that I need to complete self assessment. Around the beginning of Dec 24, I received a generic email telling me that online self assessment blah, blah, blah. I wondered if perhaps I might be eligible for a rebate or something (you never know) so I jumped on the Gov.UK site (I already have an account for Wrap Around Childcare - Armed Forces thing) and navigated to self assessment. Filled in the form and submitted it. Told me that I owe in excess of £2k and that I needed to complete a self assessment for the previous year. Another£1.5k. All to do with the High Income Child Benefit Charge. Never heard of it until that moment. I was a bit shocked and called the help line. They told me that I could appeal but I shouldn't say I didn't know anything about it as that wouldn't look very good... I thought about it over the next few days and arrived at the conclusion that that was terrible advice. The implication being that I did know about and willingly neglected to pay what I owed. The first letter I received from HMRC telling me I owed money was after I had completed a self assessment. The only other letter I have received from HMRC in recent years was an online letter informing me of their "promise" that they would ensure that they write to me if there was something that I hadn't done or if I'd paid too much or too little tax. I'm assuming that the high income child benefit thing would fall under that category... Am I at fault? The implication being that I should just know about this sort of thing or is it incumbent upon HMRC to inform me of this sort of thing. Why don't they just stop paying child benefit or present you with an option to opt out. I'm a bit stressed about the whole thing. I've written multiple appeal and complained to HMRC (all online) but I've heard nothing back. The appeal process tells you to pay the outstanding tax until HMRC decide what the outcome will be but why should I. I've done nothing wrong. Again, any pearls would be much appreciated. Many thanks.

Flugelhorn

I suspect that you may get a bit stuck here - there has been a lot of publicity over the years about the HICBC and people either not claiming the benefit or paying it back, so I suspect they don't take much notice of people saying they didn't know about it. 

One of the problems is that HMRC don't  know of the income of both people in the household hence are relying on you to say that one earns over the threshold. 

Bookworm105

I have the utmost respect for Armed Forces personnel but sorry living in that somewhat rarefied atmosphere is not a valid excuse for not following what goes on in the rest of the world.
Sorry but you have "done something wrong" - claimed CB you are no longer entitled to.

For you to owe High Rate child benefit means a) someone has claimed CB in the first place and b) having done so, there is lots of info explaining when that entitlement ends based on how much you earn.
If you really are a high rate taxpayer then one should have been capable of checking for the repercussions of that fact. Unlike the Army, you don't get your hand held for everything in the real world, it is called self assessment after all.

High Income Child Benefit Charge: Overview - GOV.UK

Ayr_Rage

As an individual you are required to know the rules and pay any tax you owe.

You have no chance of appealing anything unless those rule have not been correctly applied.

kinger101

The HMRC operate a self assessment system  If you have to file a tax return (anyone required to pay HICBC does), then the onus is on the taxpayer to submit one correctly and on time.  

Like many other laws, not being aware is not an excuse.

p00hsticks

Bookworm105 said:

Sorry but you have "done something wrong" - claimed CB you are no longer entitled to.

High Income Child Benefit Charge: Overview - GOV.UK

Ok, I'm being a bit pedantic, but the OP was indeed entitled to carrying claiming child benefit (and there may be valid reasons for continuing to do so, such as the other parent needing the associated NI credits) on the condition that they may face a tax demand for some or all of it to be paid back, as they have done. .

Bambers29

Thanks to everyone who's commented. I appreciate everything you're all saying and I really don't want to come off as being an ignoramus but I would have thought that HMRC would tell you directly if you are supposed to be completing self assessment if you have never previously done so / been required to. Doesn't seem right to me. I have canvassed several colleagues that are in the higher tax band and none of them were aware that they are supposed to be completing SA so it's definitely not just me. As for "like many other laws, not being aware is not an excuse", most laws can be inherently defined on knowing right from wrong. I don't think tax law really exists in the same sphere. I would suggest it's a little more niche than shoplifting or GBH. It doesn't seem strange to anyone that I have 1) never received any correspondence from HMRC and 2) was never made aware of any monies owed from previous financial years. HMRC obviously knew about it so why didn't I until after I'd completed SA. In this instance, ignorance sounds like a valid plea to me. I only know what I know. Thanks all the same. 

mybestattempt

The position, in accordance with the legislation, is that @Bamber29 has self assessed the HICBC liability and has no right of appeal against their own self assessment of the charge for 2022/23 and  2023/24.

Whether or not their ignorance of the law was a 'reasonable excuse' would only come into play if HMRC assessed penalties for failure to notify HICBC for earlier years. 

PensionsQuery

The OP does make a valid point about how well publicised these rules actually are, especially considering fiscal drag is catching more and more people in its net.

A friend of mine (who works in the pensions industry) was also caught out a few years back so it's not like the rules are obvious, and that's before we even get into scandals like the WASPI debacle etc.

In this day and age we all expect a certain degree of efficiency from those we deal with, however the Govt Depts still seem to operate as though it's the early 90s.

You have my sympathy @Bambers29. It's far easier to pay tax when you know it's due rather than it slowly accumulating over two years then demanded at once. 

eskbanker

PensionsQuery said:

A friend of mine (who works in the pensions industry) was also caught out a few years back so it's not like the rules are obvious, and that's before we even get into scandals like the WASPI debacle etc.

That's far from a universal viewpoint so would have been better omitted from this thread, as it's such a contentious topic, which could end up taking yet another thread off-topic....

PensionsQuery

The Govt was found to have communicated poorly in that example - that's the only point I was trying to make.

One thing I'd hope we could mostly agree on is that there needs to be more effort in communicating these complex rules to taxpayers, to avoid situations like the OPs