Around 12,000 warning notices have been sent out in error, informing taxpayers that daily penalties are mounting. The recipients of the penalty notices had previously contacted HM Revenue & Customs as their tax affairs were relatively simple and could be dealt with via their PAYE tax code. These people were informed that they didn’t need to submit a tax return in this case. However, HMRC has issued letters to these people in error, warning that the penalties are adding up.
A spokesperson for HMRC has said:
“Anyone who gets a penalty warning notice and knows they have spoken to us and we agreed that they don’t need to complete a return can simply ignore it. We are writing to them to apologise and explain.”
Following an extended filing deadline of 2nd February 2012, the daily penalties of £10 will start to build up from 1st May 2012. Taxpayers who were expected to file but didn’t submit a self assessment tax return by the deadline will have been contacted by HMRC during February and March. According to HMRC there are 650,000 taxpayers who still haven’t submitted their self assessment tax return, but need to immediately. Daily penalties will be incurred by these taxpayers from Tuesday 1st May legitimately. Over 130,000 taxpayers have been removed from the self assessment system and HMRC offer assurances that they won’t receive penalties.
The completion and submission of a self assessment tax return has to be dealt with in a timely manner to avoid unnecessary penalties and fines, which is why a number of small businesses outsource to low cost accountants.