SA interest should be shelved
The Inland Revenue will come under pressure later this month to shelve plans to impose interest payments and surcharges on self-assessment taxpayers following the deluge of returns before the 31 January deadline.
A group of chartered accountants at the English ICA will press for the surcharges to be dropped because the last minute rush of returns – 2.5 million in the last three weeks of January – is set to delay processing until the end of March.
Taxpayers who have estimated the amount of tax they owe could find they have miscalculated and underpaid.
Richard Shooter, head of the institute’s self-assessment monitoring group, said if taxpayers are unable to make up the difference until they receive a notice from the Revenue after the end of March, they will be forced to pay interest backdated to 31 January and a surcharge that takes effect 28 days later.
‘Many taxpayers will also underpay because they don’t realise they are due to make payments on account for the first half of the 1997/1998 tax year,’ said Shooter.
Shutdowns of the Revenue’s main computer systems over four days from last Friday have also prevented officers from answering many queries. The Revenue said computer systems were taken off-line to install software that will automatically issue penalty notices.