Kirkpatrick & Hopes - Succession Planning Accountants

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Do you need to notify HMRC?

Individuals are required to notify HMRC by 5 October 2016 if they are not within Self-Assessment and receive income or gains on which tax is due.

Many employees without significant other income do not receive a Self- Assessment Tax return as their tax is collected under PAYE. For example, if they start renting out a property or make a capital gain they may be required to notify chargeability.

The six-month time limit ensures that the taxpayer can be sent a tax return in sufficient time to complete it within the normal return cycle for the year.

Failure to meet the deadline means the taxpayer is liable to a financial penalty.

The maximum penalty is the net amount of tax due, but unpaid, at 31 January following the tax year in which the liability arises. This means that even if notification is made after the six-month time limit, the penalty can be eliminated if the taxpayer pays the full amount of the tax due on or before 31 January.

 

Andy Scott

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