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Tax equilisation gone wrong

Tax equilisation gone wrong

Any assistance or experience in getting the right result here.

Client worked for international company in many jurisidictions and they operated a tax equilisation scheme to ensure he was no better/worse off from other tax regimes. Fairly common occurrence.

UK tax returns were complied by a Big 4 firm (to save blushes I wont say which).

Client left this employment in 2005/06. Return done and filed. But crucially and my client didnt notice the P60 relating to the equilisation was omitted. He was also not removed from SA system.

He continued to work abroad and returned to UK last year. HMRC raised their heads and demanding payment for 2005/06 and 4 o/s returns. This is where we came in.

Problem is 2005/06 is out of time and HMRC wont accept amendment, they say debt is technically due and as client signed return, tough cheese.

I have tried asking debt collection to waive collection but am getting pretty much nowhere.

Further ideas of who to lean on as this money isnt due.

BTW I dont think a PI claim against one of the worlds biggest firms as going to be the most practical route.


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By K81
28th May 2012 13:53

I'm afraid your client may just have to pay the tax being requested. As HMRC have told you this year is out of date & amendments will not be accepted.

Also the 2007 & 2008 returns are also out of date so although HMRC will pursue for their preparation they will not actually process them once received.



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28th May 2012 18:18

" Return done and filed. But

" Return done and filed. But crucially and my client didnt notice the P60 relating to the equilisation was omitted. "

That doesn't make sense to me and I dont see why it is relevant. Are you saying that the 2005/06 tax return was incorrect? And if so why was it incorrect??

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29th May 2012 15:14

For clarity. Big 4 prepared 2005/6 return under arrangement with employer. My client never saw or signed this return. (this info was new to me and now I am seeing potential for PI issue)

Return shouild have contained 2 P60's. 1 covers the employment, 1 is tax only and covers the equalisation scheme.

The second was omitted creating a liability where 1 doesnt exist.


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