Penalty notice for charity tax return
I am trying to assist an unincorporated charity, registered with the Charity Commission. The charity does not do any trading and receives only bank interest, subscriptions for a bulletin and contributions towards admin expenses.
Last year they received a Notice to File a corporate tax return for their year ended 31st March 2009. The deadline for submission was 31st March 2010 and the paper returns (CT600 and CT600E) were filed around 29th March 2010. The preparers unfortunately misunderstood a section of the return (CT600E) which stated “Do not include amounts which are non-taxable” so did not include amounts of bank interest, subscriptions, contributions and admin expenses (as they understood that these are non-taxable for a registered charity), though details of these items were clearly included in the attached accounts. HMRC returned the tax return to the charity in early April and asked them to complete the missing boxes, which the charity did immediately and returned the forms to HMRC. HMRC have now issued a Notice of Penalty determination for £100. The charity members are dismayed as the charity receives very little income and they did try to call CAR Charities to discuss the confusing part of the tax return in March when they were preparing the return, without success. They also originally submitted the tax return by the 31st March deadline, no tax is payable, and the extra information for which HMRC returned the forms were already contained in the attachments to the tax return. They wish to appeal against the penalty determination, is there any hope of getting this penalty reduced, and are there any points that should be made or considered in the appeal? Many thanks!