HMRC are and have taken the view that they are the sole arbiters of what information is required and how and when the taxpayer, agent , customer has to supply it.
Yes we may have consultations for example look at MTD for self assessment but HMRC want it and HMRC will get it . The first item on the list is penalties then interest. All these are applied regardless of how long HMRC deal with an issue and their answer is pay up front and wee will give you back what, if anything is overpaid. One "enquiry" took 18 months mainly due to HMRC not replying to letters for three months at a time. Interest was applied and I appealed on the basis that HMRC took an undue length of time. Six months later I received a four page missive stating what the "customer" did wrong and a list of ALL the reasons why they are justified in charging interest basically the "customer" did not file their returns correctly and it was their fault. All departments are separate entities and cannot access each others systems so you put a request in to offset CIS suffered against other taxes and then debt management chase you for each tax because the CIS refunds team " is dealing with a lot of requests and take eight months to issue and allocate refunds. Debt management acknowledge this but cannot see this and then resend demands again and again and again. As for misallocated payments. One client paid with an incorrect reference for a payment in advance so it is "somewhere" HMRC then sent this "debt" to an external collection agency and baliffs arrived. In the meantime their tax return was filed and they were due a refund of the aforementioned payment in advance and more, so HMRC actually where chasing a non-existent debt. This took over an hour on the phone and six months later the client still has not received his refund. Another client was in prison on a five year term and this" did not qualify" as a reasonable excuse for the failure to file tax returns. Once again a refund situation was indicated but a point blank refusal to accept a real life situation was HMRC's position. Another client was threatened with bankruptcy whilst actually in hospital after a heart attack. I had supplied HMRC with a medical certificate prior to their call. A complaint was submitted, their written response was that whilst they acknowledge that perhaps a bit more tact could have been applied the Officer had carried out their duties as required. Refunds of overpaid CGT once a SA return has been filed, nominally 28 weeks to allocate from CGT to SA but actually you have no idea whatsoever it happens when it happens. In fact the time scale is given to tell you do not ring or contact us until after this time. Another client unbeknownst to them had a County Court Judgement raised against them because HMRC had mistaken their name with the offending client with a similar Business name. Once we had tracked this down only because my client were denied facilities to get a new telephone line once I contacted HMRC and they eventually acknowledged their mistake then they promptly declined to talk to me because we were not the authorized agent of the "customer" that should have had the Judgement raised and therefore this matter could not be discussed with me. I had to find the court where the judgement was issued and supply this back to HMRC . Once again a complaint was raised and this time with a request for costs. I applied for a transfer of a VAT number from sole trader to a company, a year later despite 25 calls emails and letters , nothing. One HMRC Officer said that their department had put a internal complaint in about the VAT team as they and I quote "simply do not answer their phones". Don't get me started on call backs".
We are a small practice and yet this is I am afraid a common occurrence across all HMRC departments. So what are supposed to do we do not have the time to document all these instances and simply have to do what we can do. HMRC is a disaster and from their attitude and perceived omnipotence it will only get worse. Passed all these issues on to our professional body but HMRC simply press ahead with their world view.
Seems like a bit of a rant I suppose when you start documenting all the "issues" but this is the actual working situation we find ourselves in
So registered for for an "ASA" as an overseas agent
The Partnership has a UK office where it is registered for UK VAT but the partners are tax resident in another EU state
Entered the Business details, professional body, Membership No. Current Gateway Codes for the business which are linked to the UK address , Business Address which happens to be in the UK
BUT the system will not accept UK, Great Britain, England etc as a "valid country". So put in the EU state where the partners are tax resident.
So a London address in an EU State!!
Pressed "send"
Response is HMRC are now checking your information and will respond in 28 days . We may contact you for more details. If you are accepted then details of how to proceed will be supplied...
I imagine that a large number of overseas agents will have a UK address for correspondence etc but actually be based in a different tax jurisdiction but all HMRC codes and the Gateway is linked to the UK address.
As usual no analysis of any actual workflow, business structure has been made.
Except for "You must have a non UK address!!
HMRC software development has not progressed since the introduction of RTI which could not cope with entities registering for PAYE in the middle of a tax year . This generated fines as the first FPS of the year was not filed.!!
I have had a couple of instances where due to PAYE tax being owed the Revenue have opened an SA record to collect the tax. In both cases they stated that the client had insufficient income to allow the collection by a change in tax code! It would seem that the Revenue are interpreting the "rules" in a manner that suits their requirements at any particular time. In both of these case the tax codes that were used were claimed to be incorrect by HMRC despite the codes being on P60's and P45's. The Revenue when I queried this stated that they never issued these despite the employer using them!
The Workplace pension schemes allow data input via csv files on a set "format" so what is the issue
NEST has one particular set of csv requirements and other pension schemes have variations on these . Accounting packages once aware of the requirements for each of these schemes output csv files to interface correctly with the respective schemes.
In reality it is no different to the pdf template that was used to send information to Companies House and HMRC for company accounts. Just type in from the balance sheet etc. That has checks for validation of data
So surely a simple Excel worksheet with fixed protected headings and a few checks should be a trivial task to be developed for the small/basic tax payer that has to comply with MTD.
I started getting these generic notices in February so I contacted the Revenue
All my clients are 9 employees and less. Revenue answer " "system" does not recognise this deregation and if you are late you will continue to get these notices. However there are no penalties at present"
It was pointed out that effectively I was running all my payrolls late as the Revenue MUST have the pay information ON or BEFORE the individual gets paid. I was submitting my payroll info before 19th of the following month to fit in with CIS EPS's. This is a no no.
This was compounded by the payroll software setting a pay date of the last Friday in every month. (you now have a variable date in the month)
This is changeable to say the 5 of every month but this default was ignored. The Revenue see the payroll date on the FPS and then take this as the date the individual gets paid so therefore if you submit after this date you are late
They are sending these notices to get customers in tune with the Revenue's requirements
I also found that the online system via an EPS to close a scheme did not work and also as usual they did not receive my letter stating the same (which was sent as a backup)
My answers
But what will change
HMRC are and have taken the view that they are the sole arbiters of what information is required and how and when the taxpayer, agent , customer has to supply it.
Yes we may have consultations for example look at MTD for self assessment but HMRC want it and HMRC will get it . The first item on the list is penalties then interest. All these are applied regardless of how long HMRC deal with an issue and their answer is pay up front and wee will give you back what, if anything is overpaid. One "enquiry" took 18 months mainly due to HMRC not replying to letters for three months at a time. Interest was applied and I appealed on the basis that HMRC took an undue length of time. Six months later I received a four page missive stating what the "customer" did wrong and a list of ALL the reasons why they are justified in charging interest basically the "customer" did not file their returns correctly and it was their fault. All departments are separate entities and cannot access each others systems so you put a request in to offset CIS suffered against other taxes and then debt management chase you for each tax because the CIS refunds team " is dealing with a lot of requests and take eight months to issue and allocate refunds. Debt management acknowledge this but cannot see this and then resend demands again and again and again. As for misallocated payments. One client paid with an incorrect reference for a payment in advance so it is "somewhere" HMRC then sent this "debt" to an external collection agency and baliffs arrived. In the meantime their tax return was filed and they were due a refund of the aforementioned payment in advance and more, so HMRC actually where chasing a non-existent debt. This took over an hour on the phone and six months later the client still has not received his refund. Another client was in prison on a five year term and this" did not qualify" as a reasonable excuse for the failure to file tax returns. Once again a refund situation was indicated but a point blank refusal to accept a real life situation was HMRC's position. Another client was threatened with bankruptcy whilst actually in hospital after a heart attack. I had supplied HMRC with a medical certificate prior to their call. A complaint was submitted, their written response was that whilst they acknowledge that perhaps a bit more tact could have been applied the Officer had carried out their duties as required. Refunds of overpaid CGT once a SA return has been filed, nominally 28 weeks to allocate from CGT to SA but actually you have no idea whatsoever it happens when it happens. In fact the time scale is given to tell you do not ring or contact us until after this time. Another client unbeknownst to them had a County Court Judgement raised against them because HMRC had mistaken their name with the offending client with a similar Business name. Once we had tracked this down only because my client were denied facilities to get a new telephone line once I contacted HMRC and they eventually acknowledged their mistake then they promptly declined to talk to me because we were not the authorized agent of the "customer" that should have had the Judgement raised and therefore this matter could not be discussed with me. I had to find the court where the judgement was issued and supply this back to HMRC . Once again a complaint was raised and this time with a request for costs. I applied for a transfer of a VAT number from sole trader to a company, a year later despite 25 calls emails and letters , nothing. One HMRC Officer said that their department had put a internal complaint in about the VAT team as they and I quote "simply do not answer their phones". Don't get me started on call backs".
We are a small practice and yet this is I am afraid a common occurrence across all HMRC departments. So what are supposed to do we do not have the time to document all these instances and simply have to do what we can do. HMRC is a disaster and from their attitude and perceived omnipotence it will only get worse. Passed all these issues on to our professional body but HMRC simply press ahead with their world view.
Seems like a bit of a rant I suppose when you start documenting all the "issues" but this is the actual working situation we find ourselves in
So registered for for an "ASA" as an overseas agent
The Partnership has a UK office where it is registered for UK VAT but the partners are tax resident in another EU state
Entered the Business details, professional body, Membership No. Current Gateway Codes for the business which are linked to the UK address , Business Address which happens to be in the UK
BUT the system will not accept UK, Great Britain, England etc as a "valid country". So put in the EU state where the partners are tax resident.
So a London address in an EU State!!
Pressed "send"
Response is HMRC are now checking your information and will respond in 28 days . We may contact you for more details. If you are accepted then details of how to proceed will be supplied...
I imagine that a large number of overseas agents will have a UK address for correspondence etc but actually be based in a different tax jurisdiction but all HMRC codes and the Gateway is linked to the UK address.
As usual no analysis of any actual workflow, business structure has been made.
Except for "You must have a non UK address!!
HMRC software development has not progressed since the introduction of RTI which could not cope with entities registering for PAYE in the middle of a tax year . This generated fines as the first FPS of the year was not filed.!!
What is the situation for "overseas" agents/Accountancy practices who do not have a UK UTR. How do they register as an MTD agent?
I have had a couple of instances where due to PAYE tax being owed the Revenue have opened an SA record to collect the tax. In both cases they stated that the client had insufficient income to allow the collection by a change in tax code! It would seem that the Revenue are interpreting the "rules" in a manner that suits their requirements at any particular time. In both of these case the tax codes that were used were claimed to be incorrect by HMRC despite the codes being on P60's and P45's. The Revenue when I queried this stated that they never issued these despite the employer using them!
The Workplace pension schemes allow data input via csv files on a set "format" so what is the issue
NEST has one particular set of csv requirements and other pension schemes have variations on these . Accounting packages once aware of the requirements for each of these schemes output csv files to interface correctly with the respective schemes.
In reality it is no different to the pdf template that was used to send information to Companies House and HMRC for company accounts. Just type in from the balance sheet etc. That has checks for validation of data
So surely a simple Excel worksheet with fixed protected headings and a few checks should be a trivial task to be developed for the small/basic tax payer that has to comply with MTD.
MTD is/was over the top anyway
How the Revenue states RTI works
I started getting these generic notices in February so I contacted the Revenue
All my clients are 9 employees and less. Revenue answer " "system" does not recognise this deregation and if you are late you will continue to get these notices. However there are no penalties at present"
It was pointed out that effectively I was running all my payrolls late as the Revenue MUST have the pay information ON or BEFORE the individual gets paid. I was submitting my payroll info before 19th of the following month to fit in with CIS EPS's. This is a no no.
This was compounded by the payroll software setting a pay date of the last Friday in every month. (you now have a variable date in the month)
This is changeable to say the 5 of every month but this default was ignored. The Revenue see the payroll date on the FPS and then take this as the date the individual gets paid so therefore if you submit after this date you are late
They are sending these notices to get customers in tune with the Revenue's requirements
I also found that the online system via an EPS to close a scheme did not work and also as usual they did not receive my letter stating the same (which was sent as a backup)