The second year of self-assessment is set to result in even more late-filing penalties than last year, as accountants and the Inland Revenue re-enact 1998’s last-minute panic.
By last week, the Revenue had received over 6.5 million of the 9.1 million returns it sent out. The figure was 500,000 up on the previous week’s tally but, even accounting for an avalanche of returns in the final few days, experts warned that more than a million taxpayers will be penalised – an increase on last year’s 900,000.
‘My feeling is that some Revenue offices are under a great deal of pressure – it’s as bad as last year,’ said Richard Shooter, chairman of the English ICA General Practitioner Board’s self-assessment committee.
David Norman, principal consultant at KPMG in Leicester, said clients had sent information to the firm later than last year.
‘Having gone through it once, clients are a little more laid back this year. Last year’s adverts warning on penalties and surcharges may have frightened people. But you end up battling to save a #100 penalty. For a lot of people, the interest on any tax they fail to pay is more serious.’
The work overload appeared to hit Worthing 1 tax office, where telephones and fax lines went dead all day Monday and only came back on Tuesday morning.
That followed last week’s 90-minute computer crash, which was caused by a deluge of enquiries after letters went to 800,000 taxpayers explaining previously mis-stated statements of account.
Stoys tax partner Mark Lee said a Revenue correction letter had meant clients were treating statements in the same way as assessments under the previous regime. ‘They don’t expect them to be right and expect accountants to tell them the right amount of tax to pay.
‘That’s completely contrary to what the Revenue wanted.’
ACCA GUILTY VERDICT ON JACKSON
ACCA council member Robert Jackson has been found guilty by an association disciplinary committee of backdating Norwich Union policy applications in order to obtain free shares. An announcement of the penalty the four partners and firm will suffer was delayed until the committee had published its reasons for the verdict. That is now expected next month.
‘ACCA finds share backdaters guilty’, page 6; Leader, page 16.
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