ICPA Analysis: Putting up barriers - HMRC & P35
Putting up barriers
Last year, the annual P35 filing deadline saw limited companies suffering at the hands of HMRC as repayments due to them were delayed so long that the Revenue had to take on extra staff to help the situation.
Well, this year we are now advised by HMRC that filing a P35 which details a repayment being due is not enough to actually generate a repayment. No, now you have to formally write a letter claiming the repayment.
You simply cannot make this up.
I quote from HMRC: “Q. How do I claim a repayment? A. At the end of the tax year, complete the P35 showing the total CIS deductions made from the company in the tax year. Then, send us a claim for repayment which must be in writing and explain the reason for the overpayment. The P35 alone is not [their emphasis not mine] a claim for repayment.”
Don’t ask me to comment on “explain the reason for the repayment”, as if the raging bloody obvious isn’t enough.
So you suffered tax deductions all year round, you’ve complied with your obligations to lodge a P35 on time, you’ve even remembered to actually write a letter asking those nice people at HMRC to please give you back your money. So when are you likely to get your repayment? Quote from HMRC again: “Q. When will the Company get its repayment? A. We aim to process claims within 15 working days of receipt. However, this may vary at peak times. Please note also that we cannot repay earlier than about two weeks after the P35 due date of 19 May [my emphasis]”.
So just when are the likely peak periods? I’d hazard a guess at the P35 filing deadline myself. As for the extra two weeks, are taxpayers granted an extra two weeks before a late filing fine is issued? You know the answer to that.
Will outpourings such as these help shape my opinion of HMRC? Yes, they most certainly will. If HMRC wants to win back the ‘hearts and minds’ of the taxpayer and their agents, is this the way to go about it? I think not, and those responsible for such drivel should be hanging their heads in shame. They should be spending their time ensuring that repayments due are made speedily, efficiently and without time wasting, and without hiding behind nonsense like “well, you haven’t sent a letter asking for the repayment so we have kept it”.
Seriously, companies are having a tough enough time as it is, without a branch of our own government adding significantly to the problems.
• Tony Margaritelli, Chairman, ICPA
This article is taken from “Accounting Practice” the ICPA quarterly magazine. Dedicated to supporting and promoting the needs of the general practitioner. You can find us at www.icpa.org.uk or email firstname.lastname@example.org or by ‘phone on 0800-074-2896