This piece first appeared in the money section of the Saga website on 8 February 2012
The text here may not be identical to the published text

FINES NEEDN’T BE FINE

If something brown and unpleasant plops through your letter box this week or next then you are probably one of the 850,000 people getting a letter from HMRC demanding a £100 fine.

The penalty is for missing the 2 February deadline for submitting your online tax return. And the demand comes with menaces – if you delay your tax return still further the fine will grow, potentially to £1600 over the next twelve months.

But there are two ways out of paying the £100 – and one of them is brand new.

Should not be here
This year for the first time the Revenue will let you off if you got a self-assessment form but you should never really have had one. Answer these questions:-

·         Were you self-employed or a partner in a business or a company director in 2010/11?

·         Was your income more than £100,000?

·         Did you get more than £10,000 in savings and investment income?

·         Did you get more than £2500 in untaxed income?

·         Did you let out a property for rent?

·         Did you get any foreign income liable to UK tax?

·         Are you claiming more than £2500 tax relief for expenses to do with your job?

If you can answer ‘no’ to all of them then you may get off the fine and be let off filling in a self-assessment form in future.

Ring 0845 900 0444 and say you are calling to see if your penalty notice can be cancelled. You will be asked a few other questions but the chances are you will be let off.

Reasonable excuse
If that fails then you have to try the other route. Say you had a ‘reasonable excuse’ for your form being late.

The Revenue said a few weeks ago that being away in the armed forces on active service would always be accepted as a reasonable excuse. As will illness or family bereavement at the crucial time. Another reasonable excuse is that you wanted to do the form online but HMRC took too long to issue you with the necessary activation code and you did it as soon as you could.

Generally, it is pretty strict about what is accepted and there is more guidance here www.hmrc.gov.uk/online/excuse-missed-deadline.htm about what will and won’t cut the nustard. But it is always worth trying your excuse and seeing if it works.

It will help your case if you have submitted your return before you apply.

Do it now
One final warning. If you have technology problems do not submit a paper return now. That will incur a fine of £100 and another £10 a day from 1 February – more than £200 already. Find a way to do it online. And as soon as you can. 

 


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