Surviving 17/18 Self Assesment (B)

John_Pierpoint · 22 January 2019 at 8:29PM

Here is a brief biography:

About 10+ years ago, I was "volunteered" for redundancy.
It was not a good time to take the year's salary offered & snapped up by some of my young colleagues.. I negotiated a bit of lieu-of-notice, statutory redundancy and a full pension.
Obviously I did not qualify for benefits, when faced with the "I Daniel Blake" situation. So I "went self employed" with two ventures and learned the joys of the then newish online Self Assesment system.

When I arrived at the age of 65 I did not claim my "Old Age Pension" (State Pension) because no other "investment" paid anything like 10% but my ventures were drying up and my last "profit" was 12/13.
However HMRC continued to tax me as though I was getting State Pension and I continued to claim back the excessive PAYE deduction on my pensions via Self Assesment.
On turning 70/71 it was time to start claiming the now enhanced State Pension.
So 17/18 tax year has now been my first year of not gettinbg a refund. Infact I have underpaid tax by £80.
However the self assessment system seems to be asking for £80 now and another £80 on account by 31st January, and sportingly saying I need to pay £0.00 in July. In otherwords I appear to be back on the self employment treadmill as far as the tax account is concerned.

Have I understood correctly that the system needs my figures and £160 by the end of the month and it will be "see you again this time next year".
https://en.wikipedia.org/wiki/I,_Daniel_Blake

tacpot12 · 22 January 2019 at 9:43PM

Are your pensions your only income?
And are you still-self employed, even if you are making a loss? (Are you still trading?)

Dazed_and_confused · 22 January 2019 at 9:49PM

So 17/18 tax year has now been my first year of not gettinbg a refund. Infact I have underpaid tax by £80.
However the self assessment system seems to be asking for £80 now and another £80 on account by 31st January

I think you have misunderstood something somewhere. If your Self Assessment liability for 2017:18 is £80 then no payments on account would be due for 2018:19.

The tax due for 2017:18 would all be payable on 31 January 2019.

The total amount payable would be £80, not £160.

NB. In theory it could be payable £40 on 31 January 2018 and £40 on 31 July 2018 but on the basis you had overpaid tax in 2016:17 then this would not apply to you

John_Pierpoint · 23 January 2019 at 11:02AM

Am I still physically trading? No I gave up within about 18 months of my second company pension kicking in at the age of 65. Physical health problems had precluded me from one of my ventures and the other was a "green" commission only sales job, where the commission rate was cut back following the cuts to subsidies.

I cannot remember exactly what I told HMRC on that year's tax return, but I do remember that as the sales were better in the winter, the "last year" ie the last few months, created a modest loss [mainly the mileage claim of chasing potential orders unsuccessfully] So after that I did not bother to carry forward the loss and HMRC did not bother to question the absence of my trading return ever since.

My feeling is that the only short term method of avoiding the £100 penalty is to bung in the £160, of which £80 probably will be needed to pay my tax this time next year anyway.

Do you think if I pay someone might have the time to think "Why has he done this? Perhaps he has always been trading and "forgot" to tell us for the last 6 or 7 years". Here starts a nightmare?

As I posted in a different thread, I now have a small property income and am happy that it now falls into the new £1,000 zero rate property band. Back in the old days - like 35 years ago - my property income was larger but still modest and I used to have to pay in advance of my annual return. If I remember the then Inland Revenue decided that payments on account were not needed for amounts below a tax of £500.
Happy days because I had a cash flow problem because of the debts my father had left me.

John_Pierpoint · 28 January 2019 at 8:44PM

On re-reading the online system, I decided that the tax payable appeared twice because there is no immediate link between the self-assessment system and the system that manages taxpayers accounts.
It is a bit like a company having an invoicing system but not updating the accounts payable for the best part of a week.
I have this image of a little man carrying a big tape of data between the two as you see in the old films from the 1960s. Perhaps someone who works for HMRC can explain how it really works?
During the payment process, I noticed there was an option of paying a "simplified return".
I think I would now qualify for the simple option.
Does anyone know how I can poke HMRC to transfer me to that system?

Surviving 17/18 Self Assesment (B)

Comments

Categories

Get our FREE Weekly email full of deals & guides - and it’s spam-free