requirement to be in self assessment

requirement to be in self assessment

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I have been trying to get a client taken out of SA. He has state pension and occupational pension. Income is £40k so he only receives basic personal allowance.

state pension exceeds PA so he is on a K code.

HMRC tell me that the K code is criteria for remaining in SA. this is the first i have heard of it! all HMRC say is that its in the guidence issued to them. i cannot see it on HMRC website. It definately isnt in TMA 1970.

All tax is collected through PAYE as he only has the two sources of income.

Is it worth appealing this?

Replies (3)

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By Peter Kilvington
20th Apr 2012 11:04

Write a letter

http://www.hmrc.gov.uk/sa/need-tax-return.htm

 

Just write a letter to the tax office explaining that the tax affairs are very simple and are covered by PAYE they should take the client outside of SA.  The above link shows HMRC's opinion / guidance.

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By mattydav
20th Apr 2012 12:16

Yes i have seen that thanks.

this appears to be new guidance issued to HMRC staff though, which isnt even on their website.

appears to be another case of HMRC making up their own rules, irrespective of what legislation states.

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By duncanedwards
20th Apr 2012 14:10

The HMRC guidance says

If you receive total income of £100,000 or more you'll need to complete a tax return.

Also if you have:

£10,000 or more income from savings and investments£2,500 or more income from untaxed savings and investments£10,000 or more income from property (before deducting allowable expenses)£2,500 or more income from property (after deducting allowable expenses)

 

Given that the higher rate tax threshold in gross income terms is only £42k or so, how is the correct tax collected (for those with total incomes between £42k and £100k) on untaxed income and income taxed at the savings rate where this doesn't exceed these thresholds?

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