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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3671
Experience:  Solicitors 2 years plus PQE
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I owe £11,000 in penalty fees to HMRC for late non payment

Resolved Question:

I owe £11,000 in penalty fees to HMRC for late non payment of taxes and late fees for not submitting returns since 2009. I have employed somebody to submit my returns, and am trying to sort out an adjustment. Is there any way I can get the tax office to reduce the penalties as I can't afford to pay them. I have an officer calling me threatening bankruptcy. The tax bill (£16,000) is something I can pay over time, but the penalty fees added is beyond my immediate means.
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Hi
Thank you for your question and welcome.
My name is ***** ***** I will assist you.
Can you tell me what information you have disclosed to the HMRC?
Kind regards
AJ
Customer: replied 2 years ago.
Returns filed for the past 5years about 5weeks ago, I'm going to try an adjustment because all my expenditures weren't listed.
Told HMRC....early this year that I had problems for a while. Marriage and home.
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
Unfortunately HMRC are willing to negotiate with business but rarely with individuals.
The only way to make them agree to any form of settlement is to make them an offer based on affordability.
Do you for example have a house you can offer a charge over as security?
Do you have a monthly income?
Kind regards
AJ
Customer: replied 2 years ago.
I am not a house owner but I am in regular work.
Customer: replied 2 years ago.
The £16,000 with possible adjustments and time to pay is possible for me with the right timescale, but £27,000 is very difficult and I don't want to be bankrupt.
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
If you are going to make an offer to repay it has to be on the basis that your repayment plan is the most you can afford.
To convince HMRC of the this I can only suggest:
1. You disclose details of your monthly income including your bank details;
2. Details of what you propose paying each month;
3. Details of any lump sum payments you can make up front.
Without full disclosure of your financial circumstances, HMRC are unlikely to accept any repayment plan.
Do you have any assets you could sell in order to raise funds?
On what grounds have you submitted your appeal?
Kind regards
AJ
Customer: replied 2 years ago.
I have nothing to sell. I need my 1997 Honda to work. I haven't appealed yet. But my grounds are I was homeless for a long while. I'm only this year getting back to normality. No excuse I know.
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
Was your fine made on the basis that it was deliberate and wilful?
A 75% fine seems very harsh - or is it a fine and interest?
Kind regards
AJ
Customer: replied 2 years ago.
Fine and interest
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
I am afraid you will have to accept that the interest is going to be payable.
What percentage is the fine? Can you tell me anything else about your circumstances that made it difficult for you to file a return?
Kind regards
AJ
Customer: replied 2 years ago.
I had to leave my house, wife and I broke up, I was living out of my car(still am to a degree). And was working up and down the country while my post was delivered to my mother inlaws. This was after we were evicted from our rental accommodation in 2008/9.
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
Firstly as I have described you have to put together a proposal for repayment installments based on affordability and disclose to HMRC all the evidence you can that verifies that you are paying this off as quickly as you are able.
Secondly you for the appeal you need to prepare a statement to show that it was ultimately beyond your control and adverse life events that meant you did not file a return. Were you are any point unwell because of these events? If so do you have a doctor who can verify this?
Kind regards
AJ
Customer: replied 2 years ago.
No, I was not unwell as I had to keep working to pay for travel hotels as well as provide for my wife and son. A very stressfully time.
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
The problem is to get HMRC to agree to your appeal you need to appeal on the grounds that your circumstances were exceptional. However unfortunate the strong of events were HMRC may just view this as normal life events - is it possible that may have suffered from depression and as result that lead you to be unable to file your returns? Is there anyone that could verify that you were in a difficult state of mind at the time?
Kind regards
AJ
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Customer: replied 2 years ago.
Unfortunately only my wife. And to some degree work.