Late return penalty

Late return penalty

Didn't find your answer?

I have been self employed for 4 years but never registered with HMRC. I have never

earnt anything close to the tax threshold and have never submitted a tax return.

I wish to clean up my tax act and HMRC have told me that I could register as a "late

notification" and submit the missing returns 9/10, 10/11 and 11/12 within 3 months

and then I shouldn't incur any penalty.

Would anyone like to confirm that and allay my fears that I could get penalised for

sending in 3 returns with £0 tax owing on them?

Thank you

Replies (5)

Please login or register to join the discussion.

avatar
By User deleted
18th May 2013 01:16

When you say that HMRC have 'told' you ...

... that there will be no penalties, do you have it in writing?

If so, I would accept their word. Otherwise, I would make a note of the date and time of the telephone call before you forget it and in case you need to refer to it later.

But the bottom line is that you do need to get your affairs in order regardless of whether penalties would be chargeable - holding off submission in the fear that penalties may arise will not help you.

Your returns will need to say a little more than the fact that no tax is due, but I supect that they will be pretty straightforward. I appreciate that it is an expense that you probably don't want to incur but you would be well-advised to seek the help of a professional.

Thanks (0)
avatar
By ver1tate
17th May 2013 20:34

Read the Uncut case on this website and state that not to give you the same leniency would be a breach of you Human Rights.

Thanks (0)
avatar
By User deleted
17th May 2013 21:04

Refer to Uncut,

complain about your Human Rights ... and be prepared to be laughed at. To compare complex offshore tax avoidance strategies - and the consequent negotiated settlements - with potential statutory penalties for the failure of an individual to comply with his fundamental tax obligations is IMO absurd and of no help to the OP whatsoever.

Thanks (0)
Universe
By SteveOH
17th May 2013 22:34

You should register

As BKD mentioned above, you should register as self employed; from the date you commenced working for yourself. HMRC will then issue you with a UTR and send you a notice to complete a Tax Return.

Normally, if you were to file a Tax Return for 2010/2011 or 2011/2012 after the deadline, you would incur a late filing penalty. However, you have 3 months from receiving the Notice to File from HMRC to actually file the Return without incuring any late filing penalties.

You may receive a penalty for late registration of self employment but I believe that this is tax geared. So if there was no tax to pay, there would be no penalty.

You would also receive a demand for arrears of Class 2 NIC but again, if your profits were below the relevant minimum for each tax year in question, you could apply for exemption.

I would suggest getting an accountant to sort it all out for you. It's not complicated but you need to follow correct procedures.

Thanks (0)
avatar
By MarionMorrison
18th May 2013 01:59

Watch the thresholds

Although you are saying that your income is below the taxable threshold, be careful, there is another lower limit which is the level at which Class 2 NI becomes payable (varies but a little under £6,000).  And if you have a year with profits above that, then you become liable to the £100 penalty for late notification.

Thanks (0)