HM Revenue and Customs are very keen for you to complete your filings in a timely way, but can often appear unresponsive to those who need assistance.
This has resulted in a record number of penalties being cancelled once the appeals found that the taxpayer was not at fault.
We want to examine the steps you can take to proactively protect yourself from any HMRC hardship you might face when handling your tax returns.
What should I do if I’m struggling with a tax return?
If you are encountering difficulty with tax filings and HMRC is not helping, then it is worth seeking professional financial advice.
However, you should act quickly as the penalties for missing deadlines are designed to be intimidating.
A single late return could land you with a £100 penalty (rising to £1,600 after a year) even if you did not actually owe any tax, placing a significant burden on many.
Late submission penalties can be even higher when significant levels of tax are owed and further penalties and interest are also charged on late paid tax.
Between 2018 and 2023, HMRC issued around 600,000 of these fines to taxpayers without any additional liability, only to revoke nearly a third on appeal.
This suggests that the system is unnecessarily harsh and could do with some measure of reform.
How can I challenge an unfair penalty?
It is vital that you do not ignore the notice.
You have thirty days to appeal, either online or by post, and HMRC will cancel your fine if you can demonstrate a “reasonable excuse.”
If you were encountering issues with a submission, either due to technical problems or personal matters, then you should document it as evidence to aid your appeal.
Screenshots of error messages, call logs, medical notes or even a timeline of events can make your case much harder to refuse.
If your appeal stalls or communications suddenly stop, you can escalate your complaint by using HMRC’s Taxpayer Charter.
That document lays out how the department must handle complaints, and you can refer to it if you feel that the system is not being properly implemented.
Where problems persist, the Adjudicator’s Office can act as an independent arbitrator for taxpayers.
It may also be possible to get a specialist tax adviser can step in to negotiate a “Time to Pay” arrangement or push your case to resolution.
There is a growing sentiment that those who are exempt from tax should not be punished for missing tax filings, although this is yet to be resolved.
There is also a hope that Making Tax Digital (MTD) will streamline HMRC’s processes so that it can better respond to taxpayers and avoid the undue stress of the current situation.
We are on hand to help you figure out your tax filings so that you do not have to be left to fend for yourself against HMRC.
Our specialist advisors can help resolve problems as they occur so that you can stay fully compliant at all times.
For help keeping your personal tax filings stress-free, speak to our team today!
