Provisional Tax Returns
I have a few clients with outstanding 2010/2011 Tax Returns, for whom the accounts for the relevant basis period have still not been prepared.
In most cases the reason for the delay in preparing the accounts is long-overdue accountancy fees.
Not all of the clients in question are "D class" clients - some have simply fallen into financial difficulties as a result of prevailing economic conditions and are extremely embarrassed at the fact that they have been unable to settle my fees.
It is my understanding that, if a client in this situation fails to submit a Tax Return online before 1 May 2012, penalties of £10 per day will start to accrue.
I do not wish to prepare the outstanding accounts until my fees for previous work have been settled, in part at least. However, I do not mind trying to help some of these clients to prepare and submit provisional Tax Returns, although I would not like to invest too much time in such (unpaid) work.
Is it acceptable to put on the Tax Return completely estimated round-sum figures for income and expenditure, together with an explanation that the figures are provisional in the absence of the necessary accounts, which have not yet been prepared owing to financial difficulties? I am aware that the provisional Tax Return would have to be amended in due course and that failure to file an amended Tax Return should, in theory at least, lead HMRC to initiate an enquiry. Whilst the suggested action may lead to an increased risk of an HMRC enquiry, would it prevent the imposition of daily penalties? If so, what do Aweb members think of this strategy? Is it asking for trouble?
I look forward to any guidance and comments.
- Anybody heard of Geniac, the new De Lorean? 107 2
- are receipts needed? 518 14
- Gift of property & improvements 134 3
- General tax book with planning 191 3
- VAT Invoice 189 6
- VAT code for invoice from not VAT registered company 275 5
- Flat rate Vat Scheme & Vat on wholesale production of Cakes and other deserts 232 9
- Error in past Corporate tax return 373 6
- Limited Company - Personal Bank Account 3,258 69
- 2013/14 failure to submit end of year submission 304 11
- Company overdue but wants to be struck off 813 32
- IHT and Swiss Property 139 1
- Sale of house with planning permission - tax free? 248 3
- Vat code for journal entries of director's expenses 170 2
- Claiming VAT and missing receipts 473 10
- HMRC overreaching its powers -again against a small surveying firm? 396 8
- Help with tax codes on Sage 265 1
- Letting relief on property transferred to a spouse 213 6
- Accounting for a finance lease 179 4
- SA302's anyone?? 552 16
- Skandia using wrong address 1,621
- Nil Rate Band Trust - index linked debt by way of charge over property 902
- International interest certificate 513
- NOVA 369
- Have we escaped Gift with Reservation of Benfit & Pre-owned asset charges? - Gift after benefit 302
- Management expenses for investment company 268
- Bonus Bonds 262
- Entertainer withholding tax in Australia 176
- tax on apprenticeship income 175
- P11D benefit received by widow 153