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August 1, 2013
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HMRC Launch 'My Tax Return Catch Up' Initiative

My Tax Return Catch Up

HM Revenue and Customs have launched a new disclosure initiative aimed at taxpayers that haven't submitted a tax return for any tax year up to 2011/12 where they have been issued a tax return by HMRC.

Taxpayers wishing to take advantage of My Tax Return Catch Up need to notify HMRC that they intend to use the initiative, submit the returns and pay any outstanding tax and NICs by 15 October 2013.

In return,most taxpayers will receive HMRC's most beneficial penalty terms and may not therefore be liable to tax geared late filing penalties that would otherwise be due.

HMRC are likely to target those taxpayers that choose not to bring their tax affairs up to date in the near future and such taxpayers may be liable to higher penalties than would otherwise have been available under My Tax Return Catch Up.  For tax years up to 2009/10 the maximum late filing penalty is 100% of the tax at stake and for 2010/11 onwards the maximum penalty is 200% of the tax at stake depending on the country in which the income/gains arose.

Late payment surcharges/penalties and interest will still be due on the outstanding amounts.

HMRC have also indicated that for taxpayers with payment difficulties they will consider time to pay arrangements as a relaxation to the requirement that the outstanding tax should be paid by 15 October 2013 - although taxpayers wishing to rely on the beneficial terms should ensure that a time to pay arrangement is formally agreed by HMRC before the deadline.

Alternative Disclosure Opportunities

Whilst My Tax Return Catch Up will be of interest to those with outstanding returns it does not appear to be available to taxpayers that have failed to notify HM Revenue and Customs of their requirement to submit tax returns.

Furthermore, those with offshore income and gains may find the terms of other disclosure opportunities more beneficial.

Alternative disclosure opportunities include:

  • Property Sales Campaign - this initiative targets those with undisclosed gains on the sale of residential property in the UK or abroad. The last date for registering under the property sales campaign is 9 August 2013, with disclosures due by 6 September 2013.  Therefore anyone wishing to utilise the property sales campaign should take action now.
  • Liechtenstein Disclosure Facility (LDF) - the LDF offers beneficial terms such as a guarantee that HMRC will not pursue criminal prosecution as well as beneficial penalty rates and a reduction in the number of years the taxpayer is required to disclose. It is aimed at those with undisclosed foreign income and gains and certain conditions must be met to obtain the beneficial terms.  Those that do not presently have a connection with Liechtenstein may transfer assets there now in order to be eligible for the LDF.
  • Isle of Man (Manx), Jersey and Guernsey Disclosure Facilities – these 3 disclosure facilities were released in 2013 and offer the ability to disclose worldwide income and gains on beneficial terms including reduced penalties and a reduction in the number of years the taxpayer is required to disclose.  For those that do not currently have assets in the Isle of Man/Jersey/Guernsey they can move assets into the relevant country – but must do so by 31 December 2013.

See our previous blogs for more information:

http://pdtaxconsultants.wordpress.com/2013/05/02/the-isle-of-man-manx-disclosure-facility-initial-thoughts/

http://pdtaxconsultants.wordpress.com/2013/05/29/jersey-guernsey-disclosure-facilities-initial-thoughts/

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