HMRC Recalculations – will this affect you?

HMRC had a bad year in the run-up to the filing deadline for Personal Tax Returns on the 31st January 2018. Just a week before, on the 24th January, they were still amending their Computations, and 30,000 Returns are now facing recalculation.

Because the Computations were being amended so close to the filing deadline, the 30,000 Returns had already been submitted. Tax Payers had followed Revenue guidance to get their Returns filed on good time, yet are now having to revisit them. In some cases extra tax will become payable. The Returns submitted include areas that HMRC were amending for, so prompt filing before HMRC had completed their final amendment has actually caused the problem.

Compounding the issue for Tax Payers though, is the decision taken by HMRC that they will NOT send copies of the recalculation to Agents. This means that the onus is on the Tax Payer to forward a copy of any recalculation to their Agent for checking.

Whilst we always recommend that clients send us copies of any correspondence from HMRC, many firms don’t, and this decision by HMRC is unhelpful at best.

If extra tax is due as a result of the recalculation, there are just 28 days in which to make payment before interest and penalties apply.

We would hope that HMRC will complete their amendments far earlier this tax season, but would also suggest that anyone who receives a revised calculation from HMRC refers it straight to their Accountant for review. It’s not uncommon for a recalculation to need adjusting!

If you’d like any advice around your tax affairs, or dealing with HMRC, please get in touch. We have many years experience in dealing with them, both on a day to day basis and supporting clients through trickier situations.