HMRC has launched a general Self-Assessment disclosure opportunity which closed on 15 October 2013. Under the terms of the "My Tax Return Catch Up" (MTRC) all errant taxpayers have a limited window to file outstanding tax returns and pay tax on any under declared income or gains.

Potential taxpayers have until 15 October 2013 to notify HMRC and they are also required to pay their outstanding tax, interest and penalties by the same date.

The standard disclosure period is 2008/09 to 2011/12, all these returns may be filed online, but if taxpayers think that they need to disclose earlier years they should seek some professional guidance to see whether this is the case.

Taxpayers should contact HMRC if they wish to make a disclosure but are unable to pay the amounts owing in time.

Penalties, interest and surcharges

Taxpayer will "receive the best terms on offer" according to HMRC by taking part in this campaign and it expects that most will not have to pay any penalties other than late filing penalties and any interest, surcharges and penalties for late payment. This is a very good deal!

What penalty will be due?

HMRC provides the following summary:

Late filing penalties for Self Assessment tax returns

For 2009-10 and earlier returns: HMRC can charge a penalty when a return is more than 12 months late based on the amount of tax owed. This can be as much as 100% of the tax, however in some circumstances this can be reduced to nothing. By taking part in the campaign, individuals will receive the best terms on offer and we expect that most will not have to pay this penalty.

Other late filing penalties will remain due. Two automatic £100 fixed penalties are charged where a Self Assessment tax return is filed more than six months late. In addition HMRC may have also imposed penalties of up to £60 per day where there has been a continuing failure to file a return. Where it is within time to file a return, these penalties are capped at the amount of tax owed so if nothing is owed the penalty is cancelled.

For 2010-11 and later Self Assessment tax returns: where a return is more than 12 months late and information has been deliberately withheld, HMRC can charge a penalty up to a maximum 100% of the tax owed (up to 200% of the tax owed if it is offshore information for 2011/12). However, in some circumstances only the late filing penalties below will apply. By taking part in the campaign, individuals will receive the best terms on offer and we expect that most will not have to pay this penalty.

Other late filing penalties will remain due. £100 is charged for a return being one day late; and £10 a day up to a maximum of 90 days (£900) from 3 months late. At six months late an additional £300 (or 5% of the tax due if more) is charged. A further £300 (or 5% of the tax due if more) is charged at 12 months late as long as no penalty for deliberately withholding information applies. These penalties are not capped at the amount of tax owed and will be due even if nothing is owed or a refund is due.

Interest and surcharges

Interest remains payable for the late payment of tax for all Self Assessment tax returns. In addition surcharges and late payment penalties may be due.

For 2009-10 and earlier Self Assessment tax returns

Surcharges will remain due as follows:

  • 5 per cent of the outstanding amounts due 28 days after the due date.
  • A further 5 per cent of the outstanding amounts due 6 months after the due date

For 2010-11 and later Self Assessment tax returns

Late payment penalties, which are separate from penalties for late filing of returns, will remain due as follows:

  • 5% of the tax unpaid 30 days after the payment due date, and
  • 5% of the tax unpaid six months after the payment due date, and
  • 5% of the tax unpaid twelve months after the payment due date

These charges remain unaffected by the campaign and will be calculated after the submission of your tax returns. Interest is also payable for the late payment of surcharges.

Links: My Tax Return Catch Up

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