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bigduckontax, Accountant
Category: UK Tax
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Hi:I have lived outside the UK since 2007, with the exception

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Hi:I have lived outside the UK since 2007, with the exception of a period when I returned there from mid 09/2010 to 8/12/2010 - when I was unemployed and sought Jobseeker's Allowance and some Housing Benefit. I got a job in December 2010 in Singapore and relocated.Since 2004 HMRC have been chasing me for tax they believe on Self-Assessment from previous years I owed. My accountant retired and I lost all records. i know that I owed them far less than that as in the tax year 2003/4 my business had made a loss. I paid then £6,000 (of a claim of about £40,000) in 2006. I was told by another accountant that I should never have done this as it was a form of admission of liability. During the period late 2004 through much of 2007 I was seriously ill mentally and was not really looking after my affairs or my business. In 2007 I was receiving counselling from psychiatrists etc and pulled myself back together, but I chose to move to Denmark where I paid tax fully on my local earnings. HMRC tried to chase me through the Danish SKAT but they told HMRC to get lost. Unfortunately things went wrong in Denmark and my employer went bust. I then lost all my belongings and all records as I could not afford the storage bill after moving from my apartment. HMRC are still chasing me and the sum has mushroomed to £70,000. I did not fill in a tax return from 2004 until last year (£0 earned in UK; they accepted that). They know I am in Singapore and I am about to submit the return for 2012/13. Will they ever stop chasing me for the original amount and rising interest?

In basic terms, no! Remember Benjamin Franklin's dictum that the only 2 certainties in life are death and taxes! As you have lost your records you have little alternative but to politely ask HMRC for a full breakdown of assessments year by year and then appeal these assessments if appropriate even though such appeals will effectively be out of time. I would be inclined to push your`inability to properly deal with your`tax affairs in a timely manner through illness from which you have now fortunately recovered. In my experience HMRC tend to be helpful to those who make a genuine effort, albeit late, to put their affairs in order. If you have over paid tax then it may well be taken into account. I recall one case where a colleague did 10 years of VAT returns one after another, the client having always just paid the VAT man's assessment, to rationalise the position and recovered the over payments!

Customer: replied 3 years ago.

Hi Keith


Thank you for your response. I guess I knew that. How would you suggest I initiate the dialogue. I run a small business now in Singapore that is pretty short on cash so I don't want to make an offer I can't live up to. Should I 'ride it' until cashflow is better and make a settlement offer? Thing is I have no records from 2004 until I came to Singapore Dec 2010. It was a real mess

Forget Singapore and the cash shortages there. Find out what HMRC are actually on about as I suggested and if their assessments are simply outrageous, which can happen, then, if you can, take them to task. Once the position is clear to your satisfaction then by all means make an offer providing you can keep up to the terms. With you overseas I can't see HMRC refusing a reasonable settlement. After all, with you outside the UK their recovery methods are somewhat restricted though they may well dun you at your ultimate port of entry! I am in the States at present and just going to bed. If you have further questions I will respond in the morning.

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