Are HMRC correct when they simply reverse a Self Assessment penalty from a client phone call?

Are HMRC correct when they simply reverse a...

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As is usual for this time of year we have received various penalty notices for late filing of Self Assessment returns - nothing new there! What we are finding is that several of our clients have been able to ring HMRC direct and have the penalty reversed and the requirement to file a return removed. All fine by me, saves time and effort, but I thought that if HMRC issued a return then it had to be filed. This being the case it makes a mockery of the system. Am I wrong?

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By justsotax
12th Apr 2012 10:43

I have done it myself....

depends on the person taking the call, some insist on written request, some just by phone.

 

I think for once this is about being practical and sensible.....where a return has been issued but it is quite obvious that it should not have then why not have a system that can accomodate these changes.  Having flexibility within a system is not a bad thing...... 

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By flurrymc
12th Apr 2012 12:22

reasonable excuse

FA’09 Sch.55 para. 23 – gives HMRC the power to determine that a penalty does not arise if there is a reasonable excuse for the failure.  As this is the only reason there can be for the cancelling of the penalty, the officer has presumably determined, on listening to the story, that there is such a reasonable excuse.

 

It would be helpful if HMRC would let us know how they determine what is, or is not, a reasonable excuse in these circumstances, but ho hum, such is life, you can’t have everything.:)

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By Steve Knowles
13th Apr 2012 09:28

Penalty notices

were to be sent out with a notice (not actually seen!) to the effect that unnecessary returns could be cancelled-

For information - from 17 February, all customers who failed to file their 2010/11 return online by the deadline will receive a flyer with their penalty notice inviting them to phone us on the general SA helpline number if they think they don’t need to be in SA. A copy of the flyer is attached.

 

Our contact centre staff will ask them some questions and if we decide we don’t need the return back we will advise the customer that we will cancel the return and remove the penalty.

 

This additional step has been introduced to mitigate the impact of the new penalty regime, such as by ensuring customers who have to pay penalties are people we need to be in SA whilst others are taken out.

 

If the return is not actually necessary, the "reasonable excuse" would appear to be irrelevant.

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