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[email protected], Accountant
Category: Tax
Satisfied Customers: 782
Experience:  Executive Director at [email protected]
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HMRC just sent me a bill charging me $1,788.00 High Income

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Hi, HMRC just sent me a bill charging me $1,788.00 High Income Child Benefit Charge, for the 2017/2018 tax year, during which I had a Taxable Income of £60,190.03 according to their records. As this is slightly over the £60k threshold I am liable to pay this charge. Is there a way to challenge this decision or retrospectively question HMRC records of my Taxable Income?
JA: Which tax year is this for?
Customer: 2017/2018
JA: Is there anything else the Accountant should know before I connect you? Rest assured that they'll be able to help you.
Customer: All information is in my original message, thanks

Hi, welcome to JustAnswer. I'm [email protected], a UK-Qualified Chartered Certified Accountant with over 15 years of experience. I'll be answering your question today.

Customer: replied 10 days ago.
Thanks

You may have to pay a tax charge, known as the ‘High Income Child Benefit Charge’, if you have an individual income over £50,000

As you income is more than the limit, you are therefore being chased for the Child benefit charge.

Customer: replied 10 days ago.
Is there a way to challenge this decision or retrospectively question HMRC records of my Taxable Income?

Is there a way to challenge this decision or retrospectively question HMRC records of my Taxable Income?

Unfortunately not. Unless your income for the said tax year was below the £50K, you have no grounds to challenge the demand.

HMRC has the right to go back at least 6 years to reclaim tax refunds and in cases of deliberate misreporting the time limit is endless.

Customer: replied 10 days ago.
As I understand HMRC records are not always 100% accurate, do I have the right to request their records for inspection? Part of the income may actually fall in a previous / subsequent tax year, which will reduce my taxable income to underneath the £60k threshold

I am sorry to be the bringer of bad news but that is how HMRC operates.

As I understand HMRC records are not always 100% accurate, do I have the right to request their records for inspection?

Yes, of course. You can request for the income statement for the tax year in question or even later years.

Part of the income may actually fall in a previous / subsequent tax year, which will reduce my taxable income to underneath the £60k threshold

Please note the threshold is £50K and not £60K

Customer: replied 10 days ago.
threshold is £60k for having to repay the full amount
Customer: replied 10 days ago.
How do I go about requesting the HMRC income statements?

Firstly to assess your High income tax charge, you may use the the link below

https://www.gov.uk/child-benefit-tax-calculator

How do I go about requesting the HMRC income statements?

You can request you income statement by using two options

  1. Accessing your personal tax account on HMRC portal.
  2. Calling the income tax helpline of HMRC on 0300(###) ###-####/li>

Customer: replied 10 days ago.
Thanks. How do I go about requesting the HMRC income statements?

If you don't have a personal tax account on HMRC portal, you may sign up for one by going to the following link

https://www.gov.uk/personal-tax-account

I hope I've answered your question? If, however, any part of my response is unclear, please do let me know and I'll try to explain it further.

Customer: replied 10 days ago.
Is it possible to retrospectively reduce taxable income for a given tax year by making voluntary NI / Pension contributions?

Is it possible to retrospectively reduce taxable income for a given tax year by making voluntary NI / Pension contributions?

No. You may however opt into a SIPP and go back 3 years but that would still not reach the 2017-18 tax year.

Customer: replied 10 days ago.
Whait is a SIPP?

SIPP (SELF INVESTED PERSONAL PENSION)

Customer: replied 10 days ago.
Is there any other way to retrospectively reduce taxable income for a given tax year?

If you had any employment expenses that you did not claim against your income, then you may submit a tax return and claim the expenses. These will then reduce your annual taxable income before allowances.

However, doing this may expose you to possible late filing charges or HMRC enquiries.

Customer: replied 10 days ago.
will HMRC then update their records i.e. in my case, if I had £190.04 of expenses, my taxable income will be adjusted to £49 999.99
Customer: replied 10 days ago.
How much could I expect to pay for late filing charges?

£1,600

Which ever way you choose, it appears that you cannot take any tax advantage from the HMRC.

Customer: replied 10 days ago.
How does HMRC assess whether this charge would apply?

Its automatic. The tax return for the year 2017-18 was due on 31 Jan 2019. If you submit it in 2022, the late filing charge will arise.

Customer: replied 10 days ago.
What do you mean by 'tax advantage from the HMRC'?

By Tax advantage, I meant avoiding having to pay back the Higher income Child benefit charge.

I hope that the above answers your questions.

Customer: replied 10 days ago.
Ok, thanks for your assistance

You're welcome. Happy to help

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