Time limits for SA Tax Returns

Time limits for SA Tax Returns

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A client fell into arrears with his SA Tax Returns and, until earlier this year, had not filed a Return since that for 2004/2005.

We completed all outstanding Tax Returns for 2005/2006 to 2009/2010 inclusive. On 29/01/2011 we filed online those for 2007/2008, 2008/2009 and 2009/2010 and subsequently submitted by post those for 2005/2006 and 2006/2007. HMRC online shows that these were received on 22/02/2011.

HMRC have processed the Tax Returns for 2006/2007 to 2009/2010 inclusive. For three of these years (2006/2007, 2008/2009 and 2009/2010) the client was entitled to a tax refund, whilst for 2007/2008 he had a liability. The client had already made a payment on account of £6,000 back in May 2007, which was more than sufficient to clear this liability, and so penalties for late submission have been reduced to nil, as of course they have been for 2006/2007 and 2008/2009.

The problem lies with the Tax Return for 2005/2006, which was not received by HMRC until 22/02/2011. As I understand it, the deadline for submitting this Tax Return was 31/01/2011 and, since it was out of date by the time we submitted it, we really shouldn't have filed it at all. I would be grateful if someone would confirm that my understanding is correct. Penalties of £200 were long ago imposed for late submission and these have been settled out of the sum paid on account in May 2007. What I really have difficulty with is the fact that the Tax Return actually shows a liability for the year of almost £5,500 (so explaining the payment on account of £6,000 back in May 2007). Since HMRC have not processed the Tax Return, this liability has not been recognised and his SA account currently shows that a significant refund is due to him.

I have not requested that the amount overpaid be refunded and I am minded to wait until after 31/01/2012 before doing so, in case HMRC decide to raise any queries into the 2009/2010 Tax Return. Would I be "safe" to request the refund after that date or is there some other action that should be taken to draw the attention of HMRC to the liability shown on the 2005/2006 Tax Return?

I would be grateful for opinions and guidance on this issue and thank you in anticipation of any assistance.

Replies (2)

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By johnjenkins
08th Nov 2011 14:09

Under normal

circumstances HMRC raises assessments when no tax return has been received and it is near "out of time". I had a similar instance but in this case it was a repayment. HMRC refused to repay under the "out of time" rule. You can bet your sweet life that if there is a liability some sort of discovery ruling will appy. You have submitted the return, they have not processed it. You are not under any obligation to advise there is a liability but I would wait until after 31/1/12 before requesting refund.

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By AndrewV12
15th Apr 2016 08:30

How did it pan out

Hi i have to file tax returns going back 7 years I have been advised that going back to 12/13 is fine, however any further back and if the returns have a liabilty of >£100, HMRC will take a view of what to do, I will be in the lap of the gods.

 

However if there is no liability HMRc probably wont even bother to process the returns.  

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