If a someone died in October 2018 (i.e. during the tax year ended 5th April 2019), does the filing deadline of 31 January 2020 still apply? If so, are there any filing penalties if not filed by 31 January 2020? for example, in the circumstance that all the information is not yet available to correctly complete that person's final Self Assessment Tax Return.
If a late filing penatly does apply, is it acceptable to file estimated figures by 31 January 2020 (to avoid the late filing penatly), and then ensure to file a revised 2018/19 return before 31 January 2021? (I will be using accountancy software to file the return online)
Any other tips on arranging tax affairs for the deceased would be much appreciated (I have checked the HMRC website but the information is limited)
Many thanks
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Replies (19)
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Late filing penalties do apply, but I have never known HMRC to refuse an appeal on grounds of reasonable excuse. Not sure quite how long they'd run with that bearing in mind that the filing deadline is 15 months after the date of death
A dead person - or rather, the executors - has less excuse than a living one.
They've had longer to fill in the return. In the case you quote, 15 months instead of a mere 10.
What have the executors been doing in the last fifteen months ?
Just saying like.
Nonsense.
Between the date of death and the grant of probate/appointment of personal representatives, there is no person with the legal power to approve and submit a return or make a payment of tax.
Indeed, arranging for payment of income tax before you are appointed as an executor is passing yourself off as an executor - a criminal offence.
It often takes many months to get probate, particularly if the estate is insolvent or there are faults in the execution of the will or its identification as the last such.
Unfortunately, as soon as HMRC are aware of a death, they automaticallycancel the agent's authority. We can't see the online details and they will not communicate with us.
The family should mark any letters addressed to the dead person "deceased" and put them back in the post. If a collector or debt collector calls, just tell them that the taxpayer is dead and they cannot have anything. They should wait until probate is granted.
When HMRC send the executors a tax return the covering letter gives the deadline as an example a client died at the end of 2017, they were notified etc. The executors were given until Nov 2019 to complete the 2017-18 tax return.
From HMRC self assessment manual:-
Extending the filing period
Where a tax return has been issued to the deceased customer before the date of death and is being reissued to a PR as a ‘Late Issue / Reissue return (SAM120040), a period of 7 days and 3 months is given for the PR to file the return, and the system is updated to show the new filing date. A reminder letter (OCAD69) will be issued after 2 months to advise the PR to contact us if he/she will be unable to file by the due date.
If the PR makes contact to say that he will not be able to file the return within that period, you should agree a reasonable date by which the return can be filed and amend the return due date for both the paper and online filing date to that date on the system.
The filing period may be extended by amending the filing due date for the appropriate year where the personal representatives satisfy HMRC that there is a reasonable excuse for not being able to file the SA return on time. The decision as to whether or not the filing period should be extended (and if so, by how much) is left to the discretion and judgement of the particular office. An SA Note must be made to explain that contact has been received from the PR and to note the reason why he/she is unable to file within the 7 day and 3 month period. Also issue SEES letter SA4 (PR more time for a return) to confirm the new filing due date and that the payment due date remains the same.
Where a filing period is extended, the personal representative(s) is/are expected to file the return by the amended filing due date. Note: An extended filing period does not change the due date for payment and this should be explained to the PR when he makes contact.
I have a client who died in October 2019. HMRC when notified sent a 2018-19 SAR for completion by 22nd February and a 2019-20 SAR by 31st October 2020
Have HMRC been notified of the death ??
Go on then- why 31st October 2020?
Absolutely no idea I quote an HMRC instructions letter
Go on then- why 31st October 2020?
Because that's the deadline for filing on paper, and they hope that they'll get it earlier than if they quote 31 January.
Quote:
Go on then- why 31st October 2020?
Because that's the deadline for filing on paper, and they hope that they'll get it earlier than if they quote 31 January.
That crossed my mind.
Possibly by the executors notifying through "Tell Us Once"I have a client who died in October 2019. HMRC when notified sent a 2018-19 SAR for completion by 22nd February and a 2019-20 SAR by 31st October 2020
Have HMRC been notified of the death ??
Theyt aren't executors until grant of probate. If the return was issued to "personal representatives of" it cannot be treated as issued if the addressee does not yet exist. Same as if the return is issued in the name of a deceased taxpayer.
Last time I was in a similar situation, I rang and spoke to HMRC who advised that if penalties were triggered, they would always accept an appeal to have these reduced to nil.
They were obviously not aware of their own guidance as highlighted by Montrose, although this was someone at a High Net Worth office, who tend to deal with things a little differently...
Until Probate is obtained the executors are not in a position to sign off a return or pay tax.
Both payment & submission deadlines should be extended to 30 days after grant of probate, so you can prepare the return and advise any tax due, ready to submit and pay when probate is granted.
I have just contacted the Tax Office as the paperwork supplied by the Executor of a Client (who passed away in October 2019) was terribly incomplete. It got rather messy as I was then told that I was not registered as the Agent, although we had been dealing with her affairs since 2009, and had submitted a 64-8.
Nevertheless, the lady listened to what I said, and said I could appeal against the penalty, and that it was more than likely that it would be cancelled.
Hope this helps.
I have just contacted the Tax Office as the paperwork supplied by the Executor of a Client (who passed away in October 2019) was terribly incomplete. It got rather messy as I was then told that I was not registered as the Agent, although we had been dealing with her affairs since 2009......
Yes - but she's not your client any more. The executors are your client. Do you have a 64-8 for their brand new UTR?
You really needed a 64-8 lodged appointing you by the executors, the old one lapsed on death..
In practice I found the simplest thing with my late father's last returns was I visited the family solicitors, completed the necessary returns there and then from their files , and just got them (one of the partners also being an executor) to submit what I had prepared- however these things are simpler re solicitors being cooperative if they had previously been your father's junior partner, not sure all firms would be happy someone popping in, using their desk space and drinking their coffee.
I don’t know whether you have resolved your query now but I wondered if this might be helpful.
I have been dealing with the return for a deceased client. The solicitor dealing with the estate has been helpful in providing income details for inclusion in the returns.
First of all you should know that two returns were required for 2018/19: One return has to be completed for the deceased for the period from 6/4/18 to date of death and a second return for the Estate of the deceased for the period from date of death to 5/4/19. This involves obtaining a separate UTR for the Estate return but the first return uses the deceased’s original UTR.
The HMRC self assessment manual https://www.gov.uk/hmrc-internal-manuals/self-assessment-manual/sam61000... states that a late filing penalty is not to be levied on the deceased. - However the executors are responsible for the Estate return and do not have the same excuse for being late therefore may have the penalty imposed.
I hope this helps.