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Sam, Accountant
Category: Tax
Satisfied Customers: 14195
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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Hello Sam! I really need your advise as I don't know what do

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Hello Sam! I really need your advise as I don't know what do do.I was registered as self employe back 2005 only for 1 year but didn't have clue how everything works.i did pay national insurance by cheque in my bank every month. I didn't work much and in the end of the financial year England revenue didn't send me anything to feel. I called them 2 times asking them to send me some papers to feel, but they told me not to worry much as they will send to me everything I need. Not everyone has computer 9 years ago. So,they didn't send me anything. And because I didn't work much I found an employe job, I did call them and cancel my account. So, all this 9 years I didn't know I have some penalty to pay. They never send me one. I was registered again 2011 and they give me new UTR number. I had an accountant and he did calculation for me now. Just 6 month ago I had letter saying to pay £4500. I did call HNRC and they check my account and told me that this is not my account and they will do investigation and saggest me to ignore this letter. In few month they sent me new letter with different £ on it. I did call them again and they told me they will do investigation again. But week ago I have a new letter with penalty £2880 from 2005/6 years. I call them and they suggest I have 2 accounts and they will do investigation and call me back. So they didn't. I don't know what to do now. They didn't send me anything for 9 years and did open new account for me which I pay on time. I didn't know I have penalty to pay as they never sent me one. And only now, 9 years pass I have penalty for all this years which is huge!!! I have 3 kids. Twins 1 year old. I can't afford to pay so much penalties. They acted very confusing all this time. Please, Sam, what you suggest to do to avoid this penalties. Thank you, Janna.
Hi Janna
Thanks for your question and asking for me
It seems to me that the not only was the tax return late but they also may have estimated what they think you earned for that year.
I am shocked that your current accountant says he does not know what to do, this is part of our day to day work, and I would strongly advise that you find yourself a new accountant that is willing and able to help you with this.
Back in 2005/2006 very few people used the computer to file online, it was still as much the paper tax returns, and this should have been sent to you the April after your first year of being self employed, and sent through the post to you. And this should have been sent out automatically from their computer system, to your home address. Did you perhaps move at all and not advise the tax office?
However, at this stage you need to get that tax return filled and sent in as soon as possible, so try and find any papers and bank statements to establish your earnings for that self employment and also what expenses you spent to earn that money, and the new accountant will do this for you.
As for the penalties, as this is now such a long time ago - I am sorry to say there is no much chance of reducing this, as the tax office would have continued to send you papers all the time to chase for the late tax return and the penalties, which is why I asked whether you have moved at all, to a new address, so did not get the letters issued to you over the years.
But again a new accountant can see if HMRC have made a mistake and whether there is anyway that this amount can be reduced. If there is not, then offer HMRC a monthly amount of what you can afford to help clear this, and if you offer to set up a direct debit (so it comes out of your bank every month) this also will help.
I am about to meet with a client, so will be back online very soon (bout 2 hours time) so if you have any follow up questions, I shall answer these when I am back at the computer.
Try not to worry about this, there is a way forward to help you resolve this problem.
Sam and other Tax Specialists are ready to help you