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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15976
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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my tax affairs are in order except for year 2007/8 which is

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my tax affairs are in order except for year 2007/8 which is still outstanding I believe the tax liability is nil but i dont really have the records to establish this . I havnt had and letters from the hmrc and i think i have paid penalties out of later years refunds under cis scheme

- are any more penalties likely
- am i likely to get an estimated bill and if so how can i challenge as i think i can only even get bank records going back 6 years
- any other advice


Were you working wholly wiithin the Construction Industry Scheme (CIS) in 2007/08? Have you completed tax returns since 2007/08?

Customer: replied 3 years ago.

no 2006/7 and 2007/8 not wholly within cis


have completed other tax returns up to date as then wholly CIS


Leave this with me while I draft my answer.
Customer: replied 3 years ago.

sorry should have added:

2008/2009 - employed /cis / claiming benefits


2009/ 10 cis / claiming benefits


2010/11 CIS


2011/12 CIS


2012/13 CIS / claimimg benefits

Hi again.

Post 5 April 2010, the penalty regime for late submission of tax returns and late payment of tax is much harsher than it was pre 5 April 2008. You can read about the current penalty regime here.

For a late 2007/08 tax return, a penalty of £100 is charged. Another £100 penalty is added if the return is six months late. If less than £100 tax is owing, the penalty is limited to the tax owing as at 1 February 2009. Interest is charged on tax paid late at the rates shown here. If tax is owing for 2007/08 as at 28 February 2009, a 5% flat rate penalty is added. If tax is owing for 2007/08 as at 31 July 2009, a second 5% flat rate penalty is added.

You may not be being chased by the tax office for your late tax return because you are on benefits or they have seen that CIS tax was deducted and that you may owe no tax or that you have moved home and not told HMRC. That doesn't let you off the hook however.

If I were you, I'd try to put something together to submit to the tax office to avoid a determination being issued which is an estimate of your tax liability and which can only be overturned by the submission of the tax return which the tax office may refuse to process leaving you with no option but to claim overpayment relief special relief. You'd need to ask your bank to see if they can supply duplicate statements for 2007/08. If that isn't possible and you have no other way of determining your earnings short of asking HMRC for their record of your CIS income, you can only hope that you will never be chased for the outstanding tax return which is entirely possible.

I hope this helps but let me know if you have any further questions.

Customer: replied 3 years ago.

thanks can you explain;


why/under what circumstances would they refuse to process my return /


how wold they determine tax due ?


Is there any time limit for an estimation



Thye may refuse to process it as you are out of time. If you were due a tax repayment, they could choose not to repay it and probably will.

They could estimate a determination or more likely base it on previous tax years' liabilities. CIS tax deductions would be taken into account. The time limits for determinations are here. HMRC would appear to be out of time to issue a determination. However, you said that some of your earnings were not CIS though that doesn't necessarily means that you owe any tax, of course.

Assuming that you completed tax returns for tax years after 2007/08, I'd be surprised if you were chased for the outstanding tax return at this late stage. It's not as if you have disappeared from their radar for several years.

There are some more useful notes here, here, here, here and here.

Customer: replied 3 years ago.

thanks this is very helpful


one last thing - i dont think i owe tax for that year as my earnings were very low - were also low in preceeding year but good ( cis tax deducted ) following 2 years .

From 2012 very low again .


if they cant issue a determination what can they do - my aim is not to avoid tax but am worried about proof as bank only keep statements 6 years

Unless HMRC think you have income of which they are not aware of or you were living a lifestyle that is not supported by your apparent income, there is nothing they can do now.
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