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Original poster

Income Tax

13 replies

racmun · 02/05/2013 17:09

My DH works and pays his tax through PAYE.
He received a letter today from a debt collection agency saying that we owe £1200.
At first we thought it was a con so contacted HMRC directly.

It transpires that because he earns over a certain threshold that he should have filed a self assessment tax return for the last 3 tax years - shit we had absolutely no idea!!!!
HMRC had an address for him from 5 years ago which is why we haven't received any paperwork etc. we had assumed that if you are PAYE your up to date details are taken from your p60. This is what has always happened in the past.

Anyway we've have had to pay £1700 today in penalties for not filing and have 14 days to fill in the forms. People at HMRC were fairly sympathetic and advised that we can appeal which we are going to do.
Does anyone have any experience with an appeal at hmrc and if so any advice?

Thanks

OP posts:
NewPerspective · 02/05/2013 18:15

Ask them to spell out in a letter when they knew about your address change...

Then, as he's PAYE, as him employer to confirm in writing the date he informed THEM of his change of address. This evidence should help shift the negligence (doing something which you ought) away from you, and onto either HMRC or the employer (doesn't really matter which one, as they both have more money than you do!)

LIZS · 02/05/2013 18:20

He would have been asked to fill in a SA if he is a higher rate tax payer and has only paid at lower. Unless he only earned over the threshold in salary the employer would not know about other income and investments. Are you saying that he didn't notify the tax office himself of change of address but assumed employer would?

LIZS · 02/05/2013 18:36

Do you have other sources of income (such a buy to let property) which may not have been taxed at source. Legal obligation is on Taxpayer to get it right and request a SA form if needs be so I wouldn't rate your chances unless it is a clear mistake on HMRC's part.

riksti · 02/05/2013 19:12

NewPerspective employers do not inform HMRC of the changes of addresses. It's the employee's responsibility. From what I understand the information sent to HMRC during a payroll run does not include employee's address.

Still, I wonder how such a large underpayment occurred. Was there unreported income or is it mainly non-filing penalties?

Original poster
racmun · 02/05/2013 19:20

He pays higher rate tax and we have no other income other than what he earns and pays tax on through PAYE through his employer. No savings either!

It's something to do with deductions from your personal allowance and tax code issues - god knows.

Just spoken to then again and they have said send the form in and they cross check everything against the P60's they hold on file. Wtf

As far as we know there isn't any tax due as its done through PAYE but the £1700 in penalties for not filing!

DH has never told them where he lives (he didn't realise he had to) and the address they hold which is 5 years old they obtained through his employer 5 years ago - so why not use the same process.

Guy on the phone was quite helpful and said that because he's PAYE and we've immediately paid the penalties as soon as we found out they might be quite lenient as its a genuine mistake.

I bloody hope so.

OP posts:
CogitoErgoSometimes · 03/05/2013 07:07

Someone else may be able to correct me but I thought, unless someone had registered for self-assessment, then they can't be fined for failing to submit. Plenty of higher-rate taxpayers are on PAYE. Does he remember registering?

riksti · 03/05/2013 08:13

If HMRC sent him tax returns he was supposed to have done them. HMRC can ask anyone to do a tax return - the problem arises, of course, if they have a wrong address on file and the person never gets the notice to file a return.

LIZS · 03/05/2013 08:53

As far as HMRC are concerned your dh has failed to comply with their repeated requests. If you can prove another govt department , such as NI , knew of the change of address and should have shared that info then you may have a case to argue but the obligation is on your dh not his employer to notify. Did you have post forwarded when you moved ? Where have his Notice of Codings been sent or has he not received them ?

CogitoErgoSometimes · 03/05/2013 08:53

That makes sense, thanks.

BMW6 · 04/05/2013 19:12

Anyone who is a higher rate taxpayer is obliged to complete Self Assessment Returns, because the basic rate tax band (20%) will have been used up by their salary under PAYE, so any other income (usually savings interest) needs to have additional tax paid on it (as it will also have only been taxed at the basic rate).
No-one is obliged to inform HMRC of change of address except the person concerned - yourselves.
However, if there is no additional tax to pay when Returns are processed then penalties can be reduced to nil. (At least that was the case when I retuired 5 years ago!)

riksti · 04/05/2013 23:05

you're not obligated to do a return just because you're a higher rate taxpayer. You're obligated to do a return if you have unpaid tax (say because you're also receiving interest income in addition to being a higher rate taxpayer because of your job). If you don't have unpaid tax since you have no other income, except for employment income, then no tax return is needed.

ChablisLover · 05/05/2013 10:07

Appeal the penalties as the address was not up to date and you dd not receive the correpondence.

It can work sometimes.

specialsubject · 05/05/2013 14:19

and start building some savings, not for HMRC fines but for real life!

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