TAX – AGAIN!
Tax may not need to be taxing. But hard work by Her Majesty’s Revenue &
Customs seems to ensure it is. Once more it has messed up collecting the tax it
takes from our pay and pensions before we even see the money ourselves.
The man in charge now says he is “deeply sorry” for the effect on
taxpayers after insisting earlier on Radio 4 that he had “no need to apologise.”
But that doesn’t help the 1.4 million people who will be told before Christmas
that they owe tax going back to 2008/09 because the Revenue failed to collect
the right amount for two years.
If you are asked to pay tax due in 2008/09 you may be able to get it
written off. If you have told HMRC which jobs and pensions you have then it
should have got your tax right. If it did not and you reasonably believed that
your tax affairs were in order then you can ask for the tax to be ‘given up’
under what is called Extra-Statutory Concession A19. You can also ask the same
concession for tax due in 2009/10 as long as it is linked to the mistake for
2008/09 and the Revenue has ignored two pieces of information which it should
have used.
If you do have to pay extra tax then ask for more time. Amounts under
£2000 will be deducted over twelve months starting in April 2011. You can ask
for that to be extended to three years if paying it over one will cause you
hardship. Amounts of £2000 or more will be asked for at once and, if you do not
pay within eight weeks, you will be put into the self-assessment regime. That
will give you three months and seven days to pay before interest is added – and
later there may be penalties on top. But again you can ask for the tax to be
collected over a longer period if paying it quickly will cause you hardship. The
Revenue has said it wants the whole process to be as “painless” as possible.
We’ll see. But one thing is clear – if you don’t ask to be excused or for
the time to be extended, the Revenue won’t offer it.
The good news is that if you owed £300 or less you will never know about
it – the Government will write it off. And it is good news for 4.3 million
people who actually Paid too much tax in those two tax years. They will be
getting a tax refund averaging about £400. That will come by post – ignore any
emails or text messages about tax refunds – they are always scams by crooks
trying to get your bank details.
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