HiI've buried my head for the last 5 years of SelfAssessment.I was issued with an estimate for 2007-08 for £31k.Today I was visited by a member of Inland revenue Enforcement team - who has demanded all returns from 2007-08 through to current are completed and returned.My accountant has just completed the assessment for 2007-08 which has calculated a bill of £7.5k. However we are being told by the taxman that this is "time-barred" and I will have to pay the estimate. "We will not look at the assessment so you might as well not bother sending it in".I admit full liability for being stupid and burying my head. but I want to do the right thing and pay up what I owe plus penalties. I was unaware of any time limits on returns - this has never been published to me.What can I do ?
Hi.Can you tell me what you do for a living please. Have you paid any tax for any of the years 2007/08 to 2011/12?
Hi again.I only asked the questions in my previous post for a bit of background information. The four year time limit is usually used by the Revenue to refuse claims for trading losses or another relief which was excluded incorrectly from a tax return. However, as you will see from SAM121080 here the time limit for the submission of your 2007/08 tax return was 5 April 2012. Had you been owed a tax repayment, the Revenue would be within their rights to refuse to process the tax return.What the Revenue have done is issue a determination of your tax liability for 2007/08 in the absence of the 2008 tax return. This is designed to force the taxpayer to do something to rectify the situation. The only way to overturn an excessive determination is to complete and submit the tax return. However, you have missed the final deadline for the 2007/08 tax return.Prior to 1 April 2010, you could claim "equitable liability" to overturn an excessive determination. From 1 April 2010 you can claim "overpayment relief" as outlined in SACM12005 here but the time limit for that is four years from the end of the tax year for which you are claiming overpayment relief so you have missed that deadline too.What you need to do is to claim Overpayment Relief:Special Relief for which there is no time limit. You can read about this in SACM12215, SACM12220, SACM12230, SACM12240 and SACM12250 starting here. Given that the determination of your liability for 2007/08 is so much higher than that actual liability as computed by your accountant, I see no reason why you should not be granted the relief. If you are, the actual tax liability for 2007/08 will replace the Revenue determination.A condition of obtaining special relief is that your tax affairs are up to date. That means completing and submitting the other outstanding tax returns and paying any tax due or coming to an arrangement with HMRC to pay it over a period of time.Let me know if you have any further queries.TonyTax41087.8397348727
Hi again.I was wondering if you received the email notification of my answer to your tax question. There is a way around the £31,000 tax determination. Let me know if you need further clarification.