Undeclared property Tax - Query

mills705

Hi

Long story cut short but through naivety and family information I did not declare income tax on a property that is owned by me legally. Although my parents manage and receive the income for the let.

I received a letter last year from HMRC about this and co operated fully. Supplying all the info along with information from my parents.

We were happy to assist as when they pointed it out I was responsible we were not aware so hands up we got it wrong.

We were provided with a figure of tax to pay so we paid this, although it did not include interest and the penalty came later.

The interest letter arrived and someone made an error with dates on it so we had this clarified and paid the new amount owed well in time ahead of the deadline which is in a weeks time. I also had to query the amount to pay as the App amount was completely different to the amount stated on the letter.

I have just checked my HMRC app and it is showing I still owe £1.35. I called the number for the I presume special department dealing with this and all they could say was it will be interest. However I do not understand this as they provided me with a figure to pay and I have paid it well ahead of the deadline. For the couple of quid I will pay it but there is a lack of communication here. It also now says it is overdue but it is within the deadline.

Can anyone help me here?

Isthisforreal99

Not sure what deadline you mean but the tax would have been due for payment by 31 January after the end of the tax year the tax was due - possibly earlier if payments on account come into play. So the interesr will continually increase until the tax is paid in full.

poseidon1

https://forums.moneysavingexpert.com/discussion/6663365/undeclared-property-tax-query

Did this HMRC enquiry process include you having to complete a formal self assessment tax return SA100 for the 2024/25 tax year?

If so, in addition to the tax payable on 31 January 2026, have HMRC also calculated that you need to make a payment on 31 July 2026 which relates to half the liability paid for 2024/25 ( its called payment on account for the 2025/26 tax year).

If you have a future payment due in July, and the £1.35 currently only represents interest on late payment of tax due on 31 January, then HMRC will simply add that to your July liability ( HMRC do not charge interest on interest).

mills705

https://forums.moneysavingexpert.com/discussion/comment/81956057#Comment_81956057

It didn't. The enquiry was raised in June/ July of last year and we had an indiviual POC. I supplied details to him and last heard from him in around Oct/ Nov and then he went silent.

I got myself a UTR realising the issue at hand and completed a self assesment ahead of the deadline and paid the necessary tax.

I just spoke with the team in the compliance bit again and they advised to speak with the self assessment bit. I did but that confused me even more as they said its as I paid part of the tax due late.

I don't have anything regarding account payments - that I am aware of.

It has been suggested that it is related to interest on tax due?

But I don't get how they do this as the amount requested should cover the interest until the deadline?

sheramber

What year was the return for and what date did you pay the amount due?

mills705

Hi so it was over a number of years, beginning in 2020 and ending in 2024. I filed a return for 24-25 in January.

I think what has happened is they produce a statement of how much you owe them and then post it to you. I paid the majority of the tax off when the initial letter was received but they then added on the interest seperately for some reason which is the 1200. But as its posted by the time you receive the letter as the interest is daily the amount has already increased leaving you with yet more to pay.

poseidon1

Since you did lodge a 2024/25 self assessment return, unless your rental tax payable for the year was below £1,000, you will have a half yearly payment due in July - see below

https://www.gov.uk/understand-self-assessment-bill/payments-on-account#:~:text='Payments%20on%20account'%20are%20payments,deducted%20interest%20on%20your%20savings)

Your HMRC account ( easily accessible via HMRC's app) should show any forthcoming July liability, and you can view your historical tax payment history as well as your prior year's liabilities and breakdown thereof. That breakdown should show when and how the interest for late payment was allocated over the 4 years to 2024.

I assume you lodged the 2024/25 return before the expiry of the 31 January deadline and paid that liability promptly?

With regard to the app, see below -

https://www.gov.uk/guidance/download-the-hmrc-app

mills705

https://forums.moneysavingexpert.com/discussion/comment/81957232#Comment_81957232

hi

we paid the bill when doing the self assessment on the app.

I think this figure comes from the compliance investigation itself