Received an unexpected tax bill?
HM Revenue & Customs have started to issue 2013/14 “reconciliations.” This means that people who do not normally complete an annual tax return may receive a document telling them that they have underpaid – or overpaid! – tax in the year ended 5 April 2014.
If you receive one of these it is important that you check it is correct – unfortunately it is not unknown for HMRC to make mistakes.
“Whilst this is a normal part of the tax calendar and indicates that HMRC is in fact doing its job there are a couple of concerns,” says Victoria Bishop, robinson+co’s Tax Partner. ”HMRC indicates that about 15% of PAYE taxpayers have not paid the correct tax – but wasn’t RTI supposed to stop the need for reconciliations? Equally, RTI hasn’t increased the speed at which information is available after the year end.”
As Patrick Stevens, Tax Policy Director of the Chartered Institute of Taxation, said:
“Employers have fulfilled their part of the bargain – they made a significant effort to switch to a new system of reporting PAYE in real time; now it is HMRC’s turn. Generally, the system is working well in respect of employer reporting but much work still needs to be done in developing the system for processing that information.”
In the meantime, do not hesitate to contact the Tax Team at robinson+co for assistance if you receive a reconciliation - Workington office on 01900 603623, Whitehaven office on 01946 692423 or Gosforth office on 019467 25808.