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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15840
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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Hi, I have outstanding tax returns from 2008-09 through

Resolved Question:

Hi,
I have outstanding tax returns from 2008-09 through to 2011-12 which I recently paid all penalties due on. After paying the penalties I received a letter, just a few days ago, from an officer at the 'Local Compliance Small & Medium Enterprises' office asking for all outstanding tax returns to be submitted within 14 days.
The letter states that should I not submit the tax returns I will receive a determination for the tax year 2010-11.
I am unable to submit the tax returns by the requested date and will have difficulty submitting accurate assessments due to lack of information for those periods.
My questions in brief are;
Can I submit tax returns as far back as 2008-09 and 2009-10 - as I've read I can't?
Why is the determination only for the tax year 2010-11 and not for all 4?
As my tax in previous years to 2008-09 was minimal will the determination reflect this?
If I receive the determination will I be able to make an arrangement to pay?
If I pay the determination do I still have to submit a teh outstanding returns?
Any advice / answers to the above would be greatly appreciated.
Kind regards,
B.
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.
Hi.

Can you tell me what you were doing for a living in the tax years that you are being chased for tax returns, whether you have any records (bank statements) and whether you think the 2010/11 determination is excessive please.
Customer: replied 2 years ago.

Hi Tony,

Thank you for replying.

I was a company director on PAYE. The companies have now been formally liquidated so I no longer have access to the PAYE records. I was earning around £20 -25k per annum over the years mentioned.

I haven't received the actual determination yet, just a letter informing me that one will be made. I also don't have personal bank statements for that period.

Kind regards,

Barrie.

Expert:  TonyTax replied 2 years ago.
Thanks.

If you were a company director, did you draw any dividend income in addition to your salary? Did you have any other sources of income? Were accounts for the company prepared and submitted to HMRC with CT600 corporation tax returns?
Customer: replied 2 years ago.

Hi.

No dividends we taken and the companies did not submit tax returns before or during the liquidation.

Expert:  TonyTax replied 2 years ago.
Thanks.

Leave this with me while I draft my answer. There is a fair amount to get through so please bear with me.
Customer: replied 2 years ago.

No problem and thank you.

Customer: replied 2 years ago.

I don't know if I made it clear in my question that the outstanding tax returns are my self assessments not company tax returns.

Many thanks.

Expert:  TonyTax replied 2 years ago.
Thanks. I did surmise that from the facts in your question. I'm working on my answer now.
Expert:  TonyTax replied 2 years ago.
Hi again.

If your 2008/09 and 2009/10 tax returns were submitted on time and they showed that you were due a tax repayment, HMRC could and probably would not repay the excess tax as you are out of time. Take a look here for the time limits. You have four years from the end of the year of assessment to make a claim for tax overpaid through PAYE. The time limits for claiming a repayment through self-assessment are the same but HMRC can refuse to amend returns where there was an opportunity to do so within twelve months of the normal filing deadline, 31 January after the end of the relevant tax year.

Take a look at the time limits table here. HMRC have three years from the filing date for a tax return where one has been issued to issue a determination. They have missed the deadlines for issuing determinations for 2008/09 and 2009/10 of 31 January 2013 and 31 January 2014 respectively. The have issued one for 2010/11 to protect their position and may well do so for 2011/12 if you don't get to grips with ths problem. You have until the later of three years from the tax return filing date or one year from the date of a determination to displace it by submitting your tax return.

As HMRC have missed the determination deadlines for 2008/09 and 2009/10, they will want you to submit the tax returns for those years. If you have overpaid, they will not repay the excess tax. However, if you owe tax they will want you to pay it. HMRC will continue to press for the 2008/09 and 2009/10 tax returns as they are out of time to issue determinations. If you don't, it will not reflect well on you if they open an enquiry into your taxes and may also reflect adversely on the assessment of any penalties due to a perceived lack of co-operation. It would be in your interest to submit these returns especially as it should be easy to obtain your pay and tax details (see below).

You may be able to make an arrangement to pay any determination. Over what period will be dependent on your situation and how much is owed. Every case is different.

You should be able to call the tax office on the number here and get your PAYE pay and tax details (and P11D details) for the tax years in question from them over the phone provided that you can tell them the name of your employer(s) for any one tax year that you need the information for as well as successfully answer their security questions, NI number, address etc. Once you have those, assuming you had no other income, you should be able to complete the returns very quickly or have an accountant or tax adviser complete them for you.

The only way to overturn a determination is to complete and submit a tax return for the relevant tax year. Where you are out of time to claim overpayment relief (the four year time limits referred to above for self-assessment), you can make a claim for overpayment relief special relief. Read from SACM12215 to SACM12270 starting here for the criteria you need to meet to make such a claim. As you will read, a claim for overpayment relief special relief for a tax year can only be made where a determination has been issued for that tax year.

I hope this helps but let me know if you have any further questions.
Customer: replied 2 years ago.

If I pay the determination will I still be required to submit the SA?

Expert:  TonyTax replied 2 years ago.
HMRC could use the discovery rules to assess any further tax they think you should pay. Anybody who thinks that a low determination necessarily lets them of the hook may be in for a rude awakening. See the time limits here again table for discovery assessments.

I always tell people to avoid lie the plague getting involved in determinations by letting their tax affairs fall into arrears. Given that it could not now be easier to get your pay and tax details for the tax years in question, I see no point in not doing so. It's not as if you were self-employed and have to try to put together several years trading accounts which is a far more onerous process than calling the tax office for pay and tax details.

One final point. If you apply for a mortgage and you have no P60s, the lender may ask to see your SA302 for each of the three previous tax years. An SA302 is the tax office calculation of your tax liability for any one tax year and lenders use them to confirm an applicant's income increasingly these days. They have credibility as nobody overstates their income in their tax return from which the SA302 is produced.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15840
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
TonyTax and other Tax Specialists are ready to help you
Expert:  TonyTax replied 2 years ago.
A point of clarification. "Lie" should have been "like".

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