Escaping the Self Assessment System…

HMRC, News, Personal Tax,

Once you’re in the HMRC Tax Return system, it can be very hard to escape. You certainly can’t rely on being able to exit on your own terms!

There are some circumstances that you may think would excuse you from the annual task of submitting a Tax Return, but it’s sadly not that simple.

  • No dividends in the tax year?
  • Income dramatically reduced?
  • All of your income from employment?

None of the above excuse you from preparing and submitting a Tax Return if HMRC ask you to do so. Failure to submit by the deadline will result in an automatic penalty for non-submission.

So, how do you escape?

The best way to avoid having to go through the process in future is to put the correct entries on your Tax Return, asking to be removed from the Self Assessment system.

We take care of these requests for our clients, as we want you off their radar as much as you want to be off it! 

Sadly, even if you make the request, there is no guarantee that HMRC will take it into account. If they do, they’ll write to confirm that you are no longer required to submit a Return and it is at this point (only!) you are off the hook.

If you ask to be removed but don’t receive the confirmation letter, you must prepare and submit the following year, and make the same request.

What happens next?

If you do escape, and receive a letter to that effect from HMRC, you need to be careful to tell them if anything changes. For example, if you didn’t receive any dividends as a result of the pandemic, and are excused, as soon as you receive them again, you should restart your Returns.

It’s called ‘Self Assessment’ for a reason, which means that YOU are responsible for declaring your circumstances. 

For clients who receive the confirmation letter from HMRC, we will ask for the next couple of years if their circumstances remain unchanged, but please do bear in mind that you need to remain vigilant to the need to restart your submissions.

If you have any questions around your Tax Return, and whether you still need to submit each year, please get in touch. If we can help you escape the filing burden we will!

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