TaxPersonal TaxEXCLUSIVE: Inland Revenue churning out penalty notices to taxpayers who met deadline

EXCLUSIVE: Inland Revenue churning out penalty notices to taxpayers who met deadline

The Inland Revenue has launched an investigation into why its computer system is wrongly issuing £100 fines to taxpayers who have submitted their self-assessment returns on time.

Apparently caused by computer glitches at local tax offices which handle both individual and corporate self-assessment returns, the Revenue is churning out penalty notices for taxpayers who in fact met the 31 January filing deadline.

Angry tax practitioners, relieved the pressure of filing self-assessment returns by 31 January were over for another year, are now faced with having to chase local tax offices to ensure their clients are not fined without due cause.

‘Early indications suggest that this is our mistake, for which we greatly apologise. We are also exploring the possibility of IT problems. We are investigating the cause as a matter of urgency,’ a spokeswoman said.

BDO Stoy Hayward tax partner Mark Lee said the problem was causing ‘needless concern and worry’ amongst clients.

Practitioners are being forced to contact clients to explain they will not be fined after all. Some have warned if the problem continues, clients may increasingly mistrust their accountants and clients could even drop their tax advisers.

Another difficulty practices face is recovering the cost of time spent on ensuring the Revenue will not impose the fine.

While the Revenue is unlikely to offer compensation for accountants time being used to reassure clients, it has pledged the phantom penalty notices will not be imposed.

‘Where it is clear that a tax return was received on time there is no question of anyone paying a fine. The penalty notice will be cancelled straight away,’ the spokeswoman added.

Inland Revenue official website

Related Articles

LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

2d Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

2w Emma Smith, Managing Editor
HMRC urged to clarify impact of income allowances on Self-Assessments

Personal Tax HMRC urged to clarify impact of income allowances on Self-Assessments

2m Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

2m Emma Rawson, ATT Technical Officer
Wealthy individuals could circumvent top tax rate rises

Personal Tax Wealthy individuals could circumvent top tax rate rises

4m Alia Shoaib, Reporter
Italy grants first successful non-dom status application to former UK non-dom

Personal Tax Italy grants first successful non-dom status application to former UK non-dom

4m Emma Smith, Managing Editor
Industry reaction: Taylor Review does not go far enough in addressing tax issues

Legal Industry reaction: Taylor Review does not go far enough in addressing tax issues

5m Alia Shoaib, Reporter
Does the Taylor Review sufficiently address the gig economy?

Corporate Tax Does the Taylor Review sufficiently address the gig economy?

5m Alia Shoaib, Reporter