UK HMRC Tax Penalty calculations

[ian in lancs]

Quick question re UK HMRC Income Tax Penalty calculations...

my friend needs to submit a self assessment for 2020-2021 and has set up the account to do so. HMRC have sent a 'notice to complete a tax return' within 90 days.

His question is... do the penalties start after those 90days, ie late submission or do the penalties start from say 5th April 2021?

late submission would mean no penalties as the 90 days hasn't been exhausted

or

penalties from 2021 would be around £1750


Which is it?

TIA

Ian

[markh1973]

If he hadn't been asked to submit a return previously then penalties should only kick in after the 90 days specified on the Notice to File.

[ian in lancs]

markh1973 said:

If he hadn't been asked to submit a return previously then penalties should only kick in after the 90 days specified on the Notice to File.

Thanks. He was hoping that was the way it is done.

[RUSTILLDOWN]

Any idea how long / complex a self assessment is the first time it’s required?

I’ll need to do it due to receiving over £10K interest this year.

[Sheepshanks]

RUSTILLDOWN said:

Any idea how long / complex a self assessment is the first time it’s required?

I’ll need to do it due to receiving over £10K interest this year.

Probably 10 mins of actually filling the form in on line. I suppose 30 mins the first time as you’ll want to read everything 3 times. Randomly (on mine and my wife’s) sometimes employment and salary information is pre-populated and sometimes it isn’t.

If you haven’t already, apply for the log-in in good time. Comes in the post and can take a couple of weeks.

[RUSTILLDOWN]

Good to know, Thanks!

[YouWhat]

ian in lancs said:

markh1973 said:

If he hadn't been asked to submit a return previously then penalties should only kick in after the 90 days specified on the Notice to File.

Thanks. He was hoping that was the way it is done.

It’s not the responsibility of HMRC to ask you to submit a return, it’s the individuals, not knowing you have to submit a return is not a valid excuse in their eyes.

[markh1973]

YouWhat said:

ian in lancs said:

markh1973 said:

If he hadn't been asked to submit a return previously then penalties should only kick in after the 90 days specified on the Notice to File.

Thanks. He was hoping that was the way it is done.

It’s not the responsibility of HMRC to ask you to submit a return, it’s the individuals, not knowing you have to submit a return is not a valid excuse in their eyes.

In this instance something has clearly triggered HMRC to request a return - we don't know what that is - by way of issuing a Notice to File. Post that being issued you have 90 days to file.

I often deal with partnerships where HMRC haven't picked up the fact that a new partnership has been created and so haven't issued the relevant paperwork. In those circumstances there is also no requirement to file (and in fact you won't be able to) until HMRC have issued you with paperwork.