Individual taxpayers who are yet to submit their 2011/12 self-assessment tax return are reminded that they will be hit by increasing penalties from next month.
The online deadline for filing self-assessment returns for the 2011/12 tax year was 31 January. Individuals that missed this deadline will have already received an initial £100 late-filing penalty.
From 1 May, there will be an additional daily £10 penalty for each day the online return is late, up to a maximum of 90 days.
For paper returns, which were due by the 31 October deadline, daily penalties began on 1 February.
Further penalties of at least £300 – or five per cent of the tax due, whichever is the greater – will then be issued for returns that are six and 12 months late.
So if you have still to file your 2011/12 self assessment tax return then you need to take action as quickly as possible because in this instance time definitely means money!!!!!!
This article was compiled by Ashley Barrowclough, Partner at Balance Accountants.
From April, HMRC will be able to collect small debts up to £3,000 through taxpayers’ PAYE codes.
Regulations came into force on 20 July 2011 to permit the additional method of recovery for self-assessment debts and tax credit overpayments. The taxman began last summer to send letters to selected self-assessment taxpayers with outstanding debts, and then to tax credit claimants with overpayments due for direct recovery.
The letters notify recipients that money owed can be collected through their pay by reducing their PAYE code. A statement of liability is enclosed, showing a summary of the debts, interest accrued to date, and the daily interest accrual rate. Accrued interest will be dealt with separately, and will not be collected through the tax code reduction.
If the taxpayer does not wish to have his or her code reduced, the individual’s tax adviser should contact the Revenue to discuss payment by an alternative method. This is also the case if having the debt coded out would cause hardship.
HMRC say the same safeguards that exist to prevent excessive deductions from salary via PAYE will apply to the coding out of debts.