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January 7, 2019

HMRC Guidance Update: Directors Not Required to Submit Returns

Following a number of tribunal cases (including Mohammed Salem Kadhem v HMRC [2017]), HM Revenue & Customs has updated its official guidance on the circumstances when a director is required to submit a self-assessment tax return.

Previously, HMRC has maintained that a director of a company was required to register for self-assessment and submit a tax return by virtue of holding office - even if there was no tax liability to report.

However, following several defeats in the courts, HMRC has now confirmed that provided that you are subject to PAYE on your income and you have no further liability to tax, you will not be required to submit a tax return.

It is important to note that if you receive dividends in excess of the dividend allowance (£2,000 for 2018/19), then additional tax may be due and you will be required to submit a return.

If you have received a notice to file a tax return but you have no further tax to pay, before the 31 January deadline you should either:

  1. Write to HMRC to request that the tax return is withdrawn; or
  2. Submit the return showing no additional tax due.

Failure to submit a return by the deadline may result in late filing penalties.

If you are unsure about whether you need to submit a return, then please contact a member of our team.

Related Articles

Directors Not Required to Register for Tax (13 January 2017)



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