Late notification penalty and form SA1

Late notification penalty and form SA1

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Form SA1 Question

Does anyone know if HMRC will issue a penalty for late notification (via form SA1) in respect of a directorship. The scenario is as follows:

A limited company with two directors (husband and wife) the husband is registered for self assessment and completes a tax return each year, however, the wife has not registered for self assessment and as such has not been issued a UTR.  She does not receive any monies from the company either in the form of salary or dividends.

Would completing form SA1 and using the original date which was 2005 trigger a late notification penalty?

Thanks

Paul

Replies (8)

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By eastangliantaxadvisor
24th Sep 2012 19:29

Does she need to complete a self assessment form?

 

A company director does not automatically have to complete a self assessment tax return. If you receive untaxed income or are liable to higher rate tax that is not deducted at source then you would need to notify HMRC.

You may find that once you notify HMRC that the limited company is trading they issue you a notice to complete a SA tax return (for yourself) and if this happens then you will need to complete and file that return.

 

There is nothing in law that says she needs to complete one!

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Paul
By pdh666
24th Sep 2012 19:41

That is my question

A company director is required to register for self assessment see form SA1, simply due to the fact of being a company director.

The issue no one seems sure on, including HMRC, is whether this late notification would cause the computer to automatically issue a penalty.  From speaking to other people it appears the consensus is that if a penalty was issued that it could be cancelled on appeal anyway but we just would rather avoid the hassle!

 

Thanks

 

Paul

 

 

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By zebaa
24th Sep 2012 20:49

No, the basis of your question is wrong.

A company director is NOT required to REGISTER for self assessment, if they do not gain an income or benefit from that directorship. Do a site search for this topic, it comes up often.

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Paul
By pdh666
24th Sep 2012 20:59

Ok so if that is the case can you refer me to the legislation indicating this please?

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By zebaa
24th Sep 2012 21:35

Choices

You could stand your question on its head and look up the requirements - thereby learning all the exclusions: Or you could do a site search.

Your call.

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By mbee1
25th Sep 2012 10:26

SA Return

I'm a Company Director receiving a salary and a dividend from the company but I am not a HR taxpayer.  I completed a Return for some years and now they have taken me out of SA saying there is no need to do one.

Thanks (1)
Euan's picture
By Euan MacLennan
25th Sep 2012 11:02

s.7 TMA 1970, Notice of liability to income tax ...

The legislation is set out in s.7 TMA 1970, the key sub-sections of which are:

7 Notice of liability to income tax and capital gains tax
7(1) Every person who–
(a) is chargeable to income tax or capital gains tax for any year of assessment, and
(b) has not received a notice under section 8 of this Act requiring a return for that year of his total income and chargeable gains, shall, subject to subsection (3) below, within six months from the end of that year, give notice to an officer of the Board that he is so chargeable.

7(3) A person shall not be required to give notice under subsection (1) above in respect of a year of assessment if for that year his total income consists of income from sources falling within subsections (4) to (7) below and he has no chargeable gains.

7(4) A source of income falls within this subsection in relation to a year of assessment if–
(a) all payments of, or on account of, income from it during that year, and
(b) all income from it for that year which does not consist of payments, have or has been taken into account in the making of deductions or repayments of tax under PAYE regulations.

7(5) A source of income falls within this subsection in relation to any person and any year of assessment if all income from it for that year has been or will be taken into account–
(a) in determining that person’s liability to tax, or
(b) in the making of deductions or repayments of tax under PAYE regulations.

 

You will find no mention that directors are required by law to notify liability to income tax and thus, be issued with a tax return.

Thanks (2)
Paul
By pdh666
28th Sep 2012 11:28

Thanks for all the replies guys, much appreciated

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