Discussion
I'm in for a £3k+ fine, but I'm questioning whether HMRC has behaved ethically and whether the quantum of the fine is justified.
Background: I'm an ignorant foreigner and wasn't aware you have to file a tax return when you earn > £100k as an employee who pays tax via PAYE. I have no savings outside of ISAs, nothing that generates capital gains, no other income etc., so I never thought I had to file a return.
I've been earning >£100k for the last 3 tax years: 2010/2011, 2011/2012 and 2012/2013.
Never heard anything from HMRC asking me to file a return or telling me I was late in filing one.
That's until 18 Feb 2014, when I'm fined £100 for failing to submit the 2012/2013 return.
I call HMRC to ask what's going on, and on the phone I'm told that, actually, I'm also late for the 2 previous tax returns.
Fast forward to today, when I recieved a nice bill of £3k+ for 3 years' worth of late filing penalties and interest.
My questions are:
- wasn't HMRC supposed to notify me each year that I was due to file a return? they failed to do that for 3 years straight
- didn't HMRC have a duty of care to notify me ASAP when I failed to file my first (and 2x subsequent) tax return(s)? Rather than sit on it for 3 years and then have the cheek to ask for thousands of £££ for late payment penalties?
What are my options now?
- Pay and shut up?
- Pay and appeal?
- Do not pay and appeal?
- Appeal by myself or via a lawyer?
Background: I'm an ignorant foreigner and wasn't aware you have to file a tax return when you earn > £100k as an employee who pays tax via PAYE. I have no savings outside of ISAs, nothing that generates capital gains, no other income etc., so I never thought I had to file a return.
I've been earning >£100k for the last 3 tax years: 2010/2011, 2011/2012 and 2012/2013.
Never heard anything from HMRC asking me to file a return or telling me I was late in filing one.
That's until 18 Feb 2014, when I'm fined £100 for failing to submit the 2012/2013 return.
I call HMRC to ask what's going on, and on the phone I'm told that, actually, I'm also late for the 2 previous tax returns.
Fast forward to today, when I recieved a nice bill of £3k+ for 3 years' worth of late filing penalties and interest.
My questions are:
- wasn't HMRC supposed to notify me each year that I was due to file a return? they failed to do that for 3 years straight
- didn't HMRC have a duty of care to notify me ASAP when I failed to file my first (and 2x subsequent) tax return(s)? Rather than sit on it for 3 years and then have the cheek to ask for thousands of £££ for late payment penalties?
What are my options now?
- Pay and shut up?
- Pay and appeal?
- Do not pay and appeal?
- Appeal by myself or via a lawyer?
Edited by matrignano on Friday 21st March 13:26
Red Devil said:
OP - >100k p.a. means you're subject to the higher rate of tax. Have you had a PAYE code notification for each of those tax years? If so, are they correct? It is possible that they aren't and your employer has therefore been deducting the wrong amounts under PAYE. Has HMRC explained how they have calculated the interest charge? (I assume they have done so on the basis of an assessment as you haven't submitted any returns).
You're stuck with the late filing penalties but any assessment can be appealed. You don't need a lawyer (if you need help from a professional it will be a tax accountant). However your first priority must be to establish what tax you actually should have paid and submit the relevant returns. The sooner you do this the better. If HMRC have assessed you and it is less than what you really owe you will be facing a further daily interest penalty.
Err, doesn't the higher tax rate apply > £150k?You're stuck with the late filing penalties but any assessment can be appealed. You don't need a lawyer (if you need help from a professional it will be a tax accountant). However your first priority must be to establish what tax you actually should have paid and submit the relevant returns. The sooner you do this the better. If HMRC have assessed you and it is less than what you really owe you will be facing a further daily interest penalty.
So, it appears HMRC might have been sending statements, notices and reminders to a 4+ years old address of mine.
For some reason, they only updated their records in Feb 2014 and that's when I started receiving their letters.
Googled it but can't find a definite answer: should have HMRC updated my address via the PAYE/NI records which show the correct address? Or was the onus on me to notify them of the change of address?
In other words, can I seek recourse on the basis that they have been sending all these letters to the wrong address for years?
For some reason, they only updated their records in Feb 2014 and that's when I started receiving their letters.
Googled it but can't find a definite answer: should have HMRC updated my address via the PAYE/NI records which show the correct address? Or was the onus on me to notify them of the change of address?
In other words, can I seek recourse on the basis that they have been sending all these letters to the wrong address for years?
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