I have a new client that has a tax return 2012-2013 to be submitted and has already racked up huge penalties. This client was only self employed from Jan 13 so only has 3 months of income plus JSA and income support. Total income for the year around £3,000 without any expenses taken into account. What are the chances of getting the client off the £1,300 penalties once the tax return has been submitted. Is there a right way of approaching HMRC. Any advice appreciated.
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Uphill struggle
You need to come up with some reason why the client has not filed his 2012/13 return before.
He will have received a notice to file and several reminders on this (many of them mentioning the penalties and that they increase over time) so you are going to struggle. The penalties used to be based on tax due, but that isn't the case any longer, so the low income won't help.
You don't provide any grounds for appeal other than "client would prefer not to have to pay". So appealing would be a waste of time.
If there are grounds - serious illness, death of a close relative etc. - that would be another matter. But you seem to be out of time to appeal, so you have an additional hurdle to get over. You need to provide grounds on which an appeal should be considered late as well.
Worth a try
One of my neighbours had exactly the same problem - I hand wrote a letter for the tax payer to sign and send to HMRC explaining I was thick and didn't earn very much so wasn't due to pay any tax and that I really didn't understand about deadlines etc and also added that I hadn't received a return to fill in - it actually worked and they removed all penalties - I was astounded!