HM Revenue & Customs (HMRC) will begin to send out letters to thousands of high-rate taxpayers later this month to remind them of an opportunity being offered by the department.
The Tax Return Initiative will target high-rate taxpayers who are yet to submit a Self- Assessment tax return for 2009-10 after being asked to do so. Under the terms of the time-limited offer, taxpayers will benefit from a reduced penalty rate by coming forward voluntarily before October 2nd, whilst those who do not will face a stiffer penalty. If HMRC has to come and find the people who have not complied, it seems certain that will more than likely feel the full force of the department’s powers, with top-rate fines and interest applied to any amounts owed.
The campaign primarily targets those who have failed to return a tax return for 2009-10 or earlier, and who pay at the 40% tax rate.
The campaign is open to those who pay basic rate tax. HMRC has written to 7,100 individuals who the authority considers to be most likely to have missed a submission “despite penalties, reminders and statements”, urging them to come forward.
Marian Wilson, Head of Campaigns at HMRC, has gone on record and said that this campaign is not meant to be construed as a threat: it is simply another part of the department’s wider aim to provide support and guidance to taxpayers on their obligations:
“This campaign offers a quick and straightforward way to bring your tax affairs up to date, but time is running out. Our aim is to make it easy for them to contact us and send in completed, putting their affairs in order. Penalties will be higher if we come and find people after the opportunity and some could face a criminal investigation. I urge people to come forward and disclose unpaid tax voluntarily.”
“Any person who has been sent returns or been told to complete tax returns for years 2009-10 or before and has not yet done so is encouraged to take part in this opportunity and can do so by submitting the returns and paying what they owe by 2 October,” she added.
Taxpayers have been able to make use of this latest initiative since July 3rd this year.
Those taxpayers who do come forward have the incentive that they will not face penalties for filing a late return.
However, what has since become clear is that HMRC may still charge an automatic fixed penalty of £100 per return, while interest and surcharges on any tax paid late will also be applicable.