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A tale of two taxpayers

27th Feb 2012
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I used to think "Time To Pay" arrangements with HMRC were a thing of the past. Now I'm not so sure.

Two clients contacted HMRC last week to try to get time to pay, only one succeeded.

Client 1 - male, sole director/shareholder of a successful company, personal taxable income from salary, benefits and dividends plus other investments - over £150,000. Dividends are covered several times over by profits after tax. He was caught unawares by the ridiculous P11D benefit from buying a BMW M5 in May 2010 without asking us for advice, and found himself a bit short of cash. He was in Spain playing golf at the end of January so he only phoned HMRC in mid-February when he received the tax reminder. He was hoping to spread the 31/1/12 payment over three months starting at the end of February.

Client 2 - female, over 65, runs successful small business with fluctuating profits. 2009-10 profits were modest, 2010-11 were double so she was hit with a big balancing payment plus much higher payments on account. She also left it until mid-Feb to contact HMRC. She has a big sale coming up in early March so needed until then to settle the liability in full.

And the outcome? Client 1 got time to pay as requested, Client 2 spoke to a very unhelpful lady at HMRC and was told, effectively, to get lost and borrow the money from her bank (which she did).

Fair and reasonable? I'll let readers decide.

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By Brugesbear
02nd Mar 2012 12:09

Why didn't you kick off?

Armed with the knowledge of what had happened to Client 1, why didn't you ring HMRC yourself after Client 2 had been rejected and get it sorted for her?

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Should Be Working ... not playing with the car
By should_be_working
02nd Mar 2012 12:17

Wrong side of bed

It's totally hit and miss.

One client of ours was out of work for a year, but had recently found employment. Had his SA liability from the last return (the year he ceased, involuntarily, self-employment) to pay, but living hand to mouth through most of this year had to use up all savings, including that put aside for the tax.

It took three phone calls, but in the end we got the (one?) reasonable person at the ironically titled "Business Payment Support Service" who, after the usual questions about access to credit (none - his credit rating rivals Athens'), savings (none), is this short term (yes, he's now in work), allowed a reasonable settlement plan.

Phone call number 2 was the one for our black museum - they were asking if he had a mortgage on the house (if not, then there's an option for raising the money apparently ... all £4k of it), what's his car registration number (err, but without the car he can't work), we didn't get as far as the inside leg measurement or which side he dresses on....

I think some of them act like they're a debt counselling service, but without the compassion. You can get lucky though, if you find one who got out of the right side of bed - I suspect that was your client 1.

Oh, and sometimes I find one whose Scottish accent this southerner can understand!

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