A (now) "fully UK" individual has the following circumstances:
1) His annual taxable income exceeds his personal allowances. He cannot therefore sign R85 self-certification for interest income to be received gross.
2) The tax deducted at source is, and will remain year on year, in excess of his annual liability, and he therefore has no obligation to notify chargeability under s.7.
3) He has no UTR and no NI No. He has no NI No because he has only recently entered the UK for the first time in his life. He has no requirement for an NI No because he will not be working (he is retired and living off investments). He did in fact apply for a NI No. anticipating the problems that its lack would likely generate, but the application was refused.
He wishes to submit annual claims for repayment of the excess tax deducted at source, and he wishes to appoint us as agents to oversee the process. Both the claiming of the overpayment and appointing us as agents seem to have problems where there is neither a UTR nor NI No.
What would be your recommendations?
The R40 route might be feesible to recover the overpaid tax. It asks for a NI No but is manually processed so it may be possible to get away without one. But getting us authorised as agents would be problematic.
My current thoughts are to tell a porky and claim that he requires to be registered for SA. Once he has a UTR we can get authorisation, we could also get the refund rather faster than the R40 system would allow, by cutting out the human factor, and would be able to monitor the account online. A potential downside is exposure to late filing penalties, but we would hope that never happens. As porkies go, that sounds like the equivalent of doing 75 down a clear motorway.
With kind regards
Clint Westwood
Replies (19)
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Assuming it is bank interest
he is living off can he not just complete a R85 for the bank? (or does he have other sources of income?)
R85
Form R85 is not applicable to this person - see point (1). R85 can only be completed if income is less than the annual tax free allowance.
...dhhh.....
schoolboy error....(memory like a fish...by the time i had read it all had forgotten about 1)
Could you try just simply submitting the relevant tax certificates and state he has no other income - avoids a R40 and they might accept a claim under these circumstances if interest is the only income. (although worrying that he has been turned down for a NINO....)...or put money into an account that pays gross (national savings etc)
A client of mine managed to get a NINO by explaining that she required it in order to open an ISA. She is well over retirement age and not a UK citizen, though she does have indefinite leave to remain.
or move to a bank where they
pay interest gross for savings of over £50k....at least then you can advise HMRC and leave them of the problem/option of creating a SA record without an NI number
R40 / 64-8
Why not just complete the R40, get client to sign 64-8 (minus NINO) and send with a covering letter explaining the position to HMRC at HM Revenue & Customs Pay As You Earn PO Box 1970 Liverpool L75 1WX. Admittedly this says PAYE but it is the address from the Revenue web site for "individuals" to contact HMRC. You may need to send evidence of tax deducted but usually repayment clams are accepted without it.
No need for NI number
Complete form R40 - they are designed for repayments for all, but chldren do not have NI numbers so it is not an issue
New claims should be sent to the dedicated repayment office - I have just copied this from HMRC website -
Repayment Claim Office
You may like to make a note of this address before you print the form R40 (PDF 94K)
If you do not have a tax office you should send your completed form R40 to
Leicester & Northants (Claims)
Saxon House
1 Causeway Lane
LEICESTER
LE1 4AA
The phone number for Leicester & Northants is 0845 366 7850
The office is open Monday to Friday 8:30 to 17:00 except for public holidays.
If you are due a repayment of income tax on your PAYE or Self Assessment income you should contact your usual tax office.
R40 or not..
Without some form of identifier there will always be an issue with the bureaucratic nightmare that is HMRC nowadays.
Maybe a SA1 would sort this. True it probably means an ITR rather than R40, but could well end up being less hassle than dealing with an individual with no 'identification'.
Disagree
Sorry - if you set up a new repayment clsim with Leicester 7 they will obviously allocate a reference number. If the client then needs to go on Self assessment at a later date the records can be transferred over to a new SA record - this is very quick and easy in my experience.
The only possible disadvantage in my experience is that repayments as far as I know can not yet go directly into a bank account but I am sure that will come with time.
SA1`
Just checked SA1 with HMRC website - you can't do it without NI number and it then tells you how to apply for NI number ! Talk about 'Catch22'
Temp NI number will be generated by HMRC
On similar case, when client has left the UK and did not have permanent NI number, we have told hmrc that client has left the UK and will not be returning back, and there was a tax refund. Employer used temporary NI number (date of birth, and M/F), then hmrc did generate temp. NI number (it is in different format these days: 12A12345) and issued the refund.
Only problem is that no 64-8 and No telephone support, only in writing.
RTI
@zokir
Do you know if new format HMRC submitted temp NIs can be used in RTI PAYE submissions?
UTR
It is not a porky to request a UTR via form SA1.
Except and unless you have this it is almost impossible to deal with HMRC on any matter.
All you do is tick an appropriate box.
In your case the last box "I have been getting untaxed income..." will do.
If it turns out you get a refund instead of paying, that is OK.
Tomazaan
I have applied for (and got) UTRs without a NI number. I never complete R40s as I find SA100s easier and the refund process is automatic. It strikes me as odd that HMRC do not ditch the R40 process and ask everyone to complete a SA100 online.
I did read somewhere that HMRC have to issue you with an UTR if you ask for one.