Don’t Let HMRC Reject You!
Tax returns can be difficult and complicated. Mistakes often happen when completing returns. Can HM Revenue and Customs (HMRC) reject an incomplete or incorrect tax return, send it back to the taxpayer for correction and treat it as never having been received, possibly resulting in late filing penalties? HMRC seem to think so. However, that […]
Penalties For Tax Return Errors – All Is Not Lost!
The penalty rules for errors in tax returns etc potentially apply if a tax return contains an inaccuracy that results in a tax liability being understated. In addition, a penalty can apply if an error gives rise to a false or inflated loss (FA 2007, Sch 24, para 1). Errors involving losses The amount of […]
Spouses’ Wages – Legitimate Expense Or Tax Dodge?
A common element in the accounts of many self-employed individuals (and partnerships) is a deduction for the wages of family members, particularly a spouse (or civil partner). For example, in over 30 years as a tax practitioner I have seen countless claims for ‘wife’s wages’. Most claims for deductions of this nature are valid and […]
Private Residence Relief: Tables Turned On HMRC!
Individuals who dispose of a dwelling house sometimes find themselves in disputes with HM Revenue and Customs (HMRC) over whether private residence relief (PRR) is due on the disposal of the property for capital gains tax (CGT) purposes (under TCGA 1992, s 222). Numerous cases have reached the courts and tribunal over the years. Burden […]
Avoid Paying HMRC By Cheque!
Many taxpayers pay their tax liabilities close to the statutory deadline for making such payments. For example, an individual who faced a large tax bill on 31 January might have needed time to find the necessary funds. Pay on time…or else? If the individual was unable to pay by 31 January, it would not necessarily […]
Avoid Paying HMRC By Cheque!
Many taxpayers pay their tax liabilities close to the statutory deadline for making such payments. For example, an individual who faced a large tax bill on 31 January might have needed time to find the necessary funds. Pay on time…or else? If the individual was unable to pay by 31 January, it would not necessarily […]
Tax Return Estimates – Careless Or Deliberate?
The use of an estimated figure may sometimes be necessary when preparing a tax return. For example, records of a particular source of income may have been lost, and it might not be possible to obtain the relevant information from third parties. Is it accurate? HM Revenue and Customs (HMRC) acknowledges that taxpayers will occasionally […]
Tax Return Estimates – Careless Or Deliberate?
The use of an estimated figure may sometimes be necessary when preparing a tax return. For example, records of a particular source of income may have been lost, and it might not be possible to obtain the relevant information from third parties. Is it accurate? HM Revenue and Customs (HMRC) acknowledges that taxpayers will occasionally […]
Tax Return Penalties: HMRC’s Fatal Flaw
Everyone makes mistakes. Fortunately, HM Revenue and Customs (HMRC) has the power to suspend a penalty for a ‘careless’ error in a tax return (FA 2007, Sch 24, para 14). HMRC officers are instructed to consider the suspension of every penalty for a careless error (see HMRC’s Compliance Handbook manual at CH83131). Suspending penalties However, […]