HELP! Directors Self Assessment not done as PAYE

How do I get out of huge penalties for non filing tax returns.

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Details: I live in Ireland but work in my company in UK . No dividends etc just PAYE income in total. All paye   done monthly. paid, filed, done ..  dusted.

OK, I have just found out (registered online to my personal tax account) apparently I am meant to have filed tax returns from 15 onwards. Back then I remember getting a notice to work, but rang them and explained I had no other income than PAYE and therefore nothing more to pay so didn't need to do a self-assessment.

That was the end of the matter... but as I said logged in earlier and it states I should have done from 15 onwards and I have penalties upon penalties piled up. I actually nearly got physically sick when I saw the amount. How can this be? No tax but just a ton of penalties.

I see case law is divided on whether directors need to file if no further tax due and some inconsistency as to what a 'director' is.

Can anyone help? I need a really good accountant who sort this mess out. Will IR just remove the penalties if I ring them and explain I have had no letters? Or will I have to pay?

Does anyone have experience in this and willing to take me on?

Replies (8)

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By Tim Vane
26th Jan 2019 23:16

Case law may well be divided but it is also irrelevant in this case, assuming that by "live in Ireland" you mean you are resident there. You have income as a non-UK resident from a non-UK resident employer so as an Irish resident with no UK source income you have no liability to UK tax so just ignore the penalties and any future UK tax correspondence. If you want, just ring HMRC and have them remove you from the system.

This of course assumes that you have been correctly declaring and paying tax on the income in Ireland.

Oh, and if you have paid any UK PAYE on your earnings you might want to ask for that back too.

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By willowspillows
26th Jan 2019 23:22

No sorry the company is UK based, I drive over the border and work in UK (well actually I work from home in Ireland 95% of the time!) but the company is UK based.

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By willowspillows
26th Jan 2019 23:23

Yes I am resident in Ireland. Moved from UK in 2000.

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By willowspillows
26th Jan 2019 23:25

Yes I declare the tax in Ireland but get a DTR on it so pay no further tax in Ireland. My Irish accountant does an annual return showing my UK income, my UK PAYE, nil return for Irish tax authories.

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By Tim Vane
27th Jan 2019 01:14

Where does the DTA say you are resident for tax purposes? Notwithstanding your trips over the border it still seems to me that both you and the company are resident in Ireland. Does your base in NI count as a PE? I seem to remember there are special rules in the DTA covering NI businesses run from Ireland that treat the border as effectively invisible so your company’s base is still Ireland if you own and run it, but I’m no expert on NI matters do you might get better answers from others.

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By bernard michael
27th Jan 2019 10:33

It's unclear from your question whether HMRC agreed that you did not have to file returns. If they did they would have put it in writing
The rules are if HMRC ask for returns to be submitted you have to . Directors do not automatically have to submit returns by virtue of being directors.

Have you actually spoken to HMRC to assess their position?

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By David Heaton
27th Jan 2019 17:38

From the brief information here, you need to consider article 4 'Fiscal Domicile' and article 15 'Employment' of the UK-ROI DTA. Your UK company is UK-resident because of incorporation, but central management and control is probably in ROI, which probably makes it Irish resident too. Art. 4 would then make it Irish resident rather than UK.

Once you work through where both you and the company are resident, taking into account UK and ROI law and the tiebreakers in art.4, if you really work from home in ROI 95% of the time and spend less than 183 days in NI, art. 15 might mean you're not liable in the UK at all. Even if you are liable in the UK, it should be on a pro rata basis, based on day counting for workdays each side of the border.

It's an odd set of circumstances, though, so take advice from someone who deals with DTAs.

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By Tax Dragon
27th Jan 2019 17:39

Spot the irony: an OP comes to Aweb asking for professional assistance because of a tax-related issue. The advice from Aweb is "don't do that - talk to HMRC".

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