Managing the 31St January Deadline

Managing the 31st January Deadline

Supplementary information to follow Internet article

Q and As

1. We have heard of a number of examples where paper applications for agent authorisation (Form 64-8) for Self Assessment have not been turned around within 24 hours. Please clarify the circumstances in which the Central Agent Authorisation Team (CAAT) do turn around applications within this timescale.

Answer: Since 4th January 2010 CAAT have processed over 50,000 SA agent authorisations within 24 hours of receipt in CAAT. We are therefore achieving our target times for many applications for authorisation. However, we may not have made clear what this means in practice for agents and this has led to some confusion over whether the timescale is being met or not.

For example, there are a range of factors that determine how quickly the form takes to get to CAAT, including postal delays and the form being initially sent to another HMRC office. It can also take up to 72 hours for our electronic systems to be updated and for the new client to appear on your client list although you’ll be able to call the Agent Dedicated Line to discuss your clients’ affairs sooner than that.

So while this is a significant improvement in the service we can offer agents, it may not always be apparent to agents.

We should also make clear that this applies only to Forms 64-8s where the customer/client is already registered for SA. Where the Form 64-8 accompanies an SA1 or CWF1 (i.e. the client is not already registered for SA), turnaround will take longer while the associated registration is processed.

2. So what about new customers where there is neither a UTR nor a Form 64-8 authorisation in place. When will these applications be dealt with?

Answer: We have put additional resource into the CAAT team to help manage the volumes of agent authorisations and UTR issues at this peak time. All UTRs (with the exception of those in respect of Limited Liability Partnerships which we are working hard to clear) sent to CAAT before 16 November 2009 have now been dealt with.

We’re also pleased to say that the large majority of 64-8s for SA authorisation received by 11 January 2010 have been processed; and applications for Agent Codes requested before 24 December 2009 have now been cleared.

We would, however, ask agents to bear in mind that if an individual is not yet registered for SA then we do not require a return by 31st January since we have not issued a Notification to File.

3. So – if my client hasn’t received a “Notice to File” from HMRC I don’t need to file a return by 31st January?

Answer: The 31 January 2010 deadline only applies to customers where HMRC has sent a ‘Notice to File’ a tax return online.

4. Won’t my clients be penalised if they don’t meet the filing deadline?

Answer: A penalty will apply where people do not meet the deadline set on the Notice To File we send out. For most people, this is 31 January.

If an individual has had chargeable income during 2008-09 but notified us after 5 October, they should file by the deadline shown on the Notice To File. This will usually give them 3 months. If they had chargeable income in 2008-09 but have not yet notified us, they should firstly register for SA using form SA1 or CWF1. We will then send a Notice to File and set the deadline for filing.

Anyone who should have notified us of their chargeability by 5 October 2009 but did not do so may be subject to a penalty for Failure to Notify.

Penalties for Failure to Notify are linked to the tax outstanding and it is therefore possible to reduce the penalty by paying the tax due by 31 January. In these cases a return is not required by 31 January but agents can download form SA 361, insert the words “New Customer” in the SA reference box and send the completed form to us with a cheque for the tax/NICs due.

Guidance on deadlines and penalties can be found here http://www.hmrc.gov.uk/sa/deadlines-penalties.htm

5. We’re concerned that, if we make a payment using Form SA361, HMRC will have difficulty matching this to the UTR once it’s finally issued. How do you propose to ensure that payments made without UTRs are correctly allocated?

Answer: We recognise that it would be preferable not to receive payments using the Form SA 361 but it does enable a customer to reduce any penalty where they have failed to notify their chargeability in time. It would help us to connect payments to the correct record if a covering letter is submitted with the Form SA361 stating:

 the client’s name  the client’s NINO  a short explanation that the payment is in respect of SA and a UTR is awaited  The date upon which the UTR was applied for (if known) and confirmation that the application went directly to CAAT

6. Can a customer who is not registered for SA and does not have a NINO pay electronically to avoid a penalty?

Answer: In theory, anyone wishing to make a payment electronically can do so (though not by using Direct Debit, Debit or Credit Card because these always require a UTR). The difficulty is that when the payment arrives we will have to allocate it to our “suspense account” and the payer will have to tell us separately what the payment is intended for and provide sufficient information to enable us to identify and allocate it.

We think that payment by this method is therefore more likely to cause problems with matching than the Form SA 361 so we’re not recommending new customers to pay electronically

7. Last year the information displayed on the View Account page showed the amount becoming due for payment as the total amount owed over the next 13 months. Has this now been corrected?

Answer: We have clarified the information provided to advise customers that they should click on the figure of total tax due to see the actual amounts and due dates for payment.

The instruction now explains “You have a total of £xxxx becoming due for payment. A payment is due on dd mm yyyy and you should click on the figure of tax becoming due for more information”.

8. What about cases where people have registered to use the online service in good time but haven’t received their activation PINs in time to file by the deadline? Will claims for reasonable excuse be considered?

Answer: Where people have registered to use the online service but haven’t received their activation PINs by Saturday 30 January, in time to file by the deadline, we will consider claims for reasonable excuse sympathetically on the normal case by case basis.

Anyone appealing against a penalty on the grounds of reasonable excuse should provide details of why they were unable to file online by the deadline. It is of course important that the customer with a reasonable excuse filed online as soon as possible once their activation PIN was received.

9. For 31st January 2010, where should I send returns for non UK resident foreign domiciliary partnerships without a NINO when a Self-Assessment tax return has to be completed for the first time and cannot be filed online?

Answer: Such partnership paper returns, marked for the attention of Mark Johnson, should be sent to the following address by 31 January 2010:

HM Revenue and Customs LCPU 6th floor City Centre House 30 Union Street Birmingham B2 4AE

Any queries can be made by telephone to 0121 634 0525

10.For 31st January 2010, how should I file an SA return for a Partnership that has a Public Body without a UTR as a member?

Answer: Public Bodies, Government Departments and similar bodies are in the process of being given a UTR by HMRC but these allocations are not yet complete. If a partnership includes a Public Body as a member and no UTR is available then, in these circumstances, a paper return, marked for the attention of Mark Johnson, should be sent to the following address by 31 January 2010.

HM Revenue and Customs LCPU 6th floor City Centre House 30 Union Street Birmingham B2 4AE

Your return will be regarded as complete and late filing penalties will not be applied.

Any queries can be made by telephone to 0121 634 0525

11.For individuals who are not domiciled & or not ordinarily resident in the UK.

Answer: A remittance based charge was introduced in April 2008 as part of the changes to the rules on the remittance basis for individuals who are not domiciled and/or not ordinarily resident in the UK. This allows for an individual, provided certain criteria are met, to pay a set charge (currently £30,000) in respect of income and/or gains that they have abroad & not remitted to the UK in that year & have been specifically nominated.

12. In these circumstances, where do I obtain the ten digit Unique Taxpayer Reference (UTR) to enable the claim to be made and where do I send the completed tax returns?

Answer: Please send relevant completed tax returns and address requests for UTRs to:

Mrs B Whittington St Johns House Merton Road Bootle Merseyside L75 1BB

Telephone number 0151 472 6389 Fax: 0151 472 6006