Self Assessment Interest charges after mistake

liverpoolfan123

My 2021/2022 SA was incorrectly completed by me, due to a company name change i failed to send the whole year total. I only complete SA due to child benefit, which i have subsequantly stopped. However, HMRC sent me a rebate in August 2024, which i immediately queries in the early september to confirm the error. I was told that i needed to send a revision letter in to them, which i did in the same month, and not until July 2025 did i get another letter, saying that i now owed that money back, plus interest back to 2021/2022 tax year as it was now deemed - failure to notify. I have since complained again in July, and this week been told the charges stand and now i have 10 days to pay or debt collectors will be sent. I fully understand i need to pay the value for the tax back, and have that ready, but no not feel i should owe the interest OR penalties for not paying on time, when it has taken them over 16 monts since the error to come back to me with any details.

Aylesbury_Duck

liverpoolfan123 said:

My 2021/2022 SA was incorrectly completed by me, due to a company name change i failed to send the whole year total. I only complete SA due to child benefit, which i have subsequantly stopped. However, HMRC sent me a rebate in August 2024, which i immediately queries in the early september to confirm the error. I was told that i needed to send a revision letter in to them, which i did in the same month, and not until July 2025 did i get another letter, saying that i now owed that money back, plus interest back to 2021/2022 tax year as it was now deemed - failure to notify. I have since complained again in July, and this week been told the charges stand and now i have 10 days to pay or debt collectors will be sent. I fully understand i need to pay the value for the tax back, and have that ready, but no not feel i should owe the interest OR penalties for not paying on time, when it has taken them over 16 monts since the error to come back to me with any details.

Isn't that moot, though?  The original error was yours from a few years ago.  Even if they had billed you 16 months ago the late payment charge would have been applied, and the only thing the interest does is adjust for the time elapsed, so it's not a true additional cost, simply a way of maintaining the value in real terms.  You shouldn't be worse off as a consequence of the interest.

mybestattempt

liverpoolfan123 said:

My 2021/2022 SA was incorrectly completed by me, due to a company name change i failed to send the whole year total. I only complete SA due to child benefit, which i have subsequantly stopped. However, HMRC sent me a rebate in August 2024, which i immediately queries in the early september to confirm the error. I was told that i needed to send a revision letter in to them, which i did in the same month, and not until July 2025 did i get another letter, saying that i now owed that money back, plus interest back to 2021/2022 tax year as it was now deemed - failure to notify. I have since complained again in July, and this week been told the charges stand and now i have 10 days to pay or debt collectors will be sent. I fully understand i need to pay the value for the tax back, and have that ready, but no not feel i should owe the interest OR penalties for not paying on time, when it has taken them over 16 monts since the error to come back to me with any in

Your post is little difficult to follow but it appears you accept that there is additional tax to pay for 2021/22 because you made an incorrect self assessment for that year.

It also seems that this only came to light in August 2024 and it took until July this year for HMRC to inform you about the tax, interest and penalties now charged because the 2021/22 self assessment return was incorrect.

You cannot appeal against interest due on tax paid late; the 2021/22 tax was due and payable by 31 January 2023.

I am confused by your reference to penalties for failure to notify if you made an inaccurate self assessment return for 2021/22; the penalty assessment will have detailed the type of penalties charged and explained your rights of appeal.

However, the 11 months delay between you telling HMRC about the income you omitted from the 2021/22 return and HMRC taking action to assess penalties would not be grounds to appeal and I suspect HMRC will have already explained that to you.

If I have misunderstood anything please explain as it maybe possible to give further and better advice.

sheramber

It is your responsibility to play the correct tax at the due date. That is what self assessment means. 

When you got the rebate in August 24 there would be interest included( repayment supplement)

when you knew that was wrong you should have sent the repayment back  immediately. 

It would be recorded at the date of receipt until HMRC amended your record.

You would still have failure to notify penalties as you did fail to notify them of the correct figures at the correct time. 

That is only fair to those who do pay the amount due at the correct time.